“Free?” Credit Reports

Most everyone knows they should review their credit report occasionally.  We’ve been promised a free credit report but how do we get it without purchasing other unnecessary services?  Are there credit services we should consider?

According to the Federal Trade Commission’s (FTC) website annualcreditreport.com is the ONLY authorized online source for you to get a truly free credit report under federal law.  Some other sites claim to offer “free” credit reports, but may charge you for another product if you accept a “free” report.  AnnualCreditReport.com is the official site to help consumers obtain their free credit report.  This central site allows you to request a free credit file disclosure, commonly called a credit report, once every 12 months from each of the nationwide consumer credit reporting companies: Equifax, Experian and TransUnion (yes, that’s a total of 3 different credit reports/year).  A fourth national credit bureau named Innovis exists, but does not currently seem to factor into decisions for denials of credit, insurance or employment.  You do not need to purchase any of the other services offered to obtain a full credit report for free.  Credit scores are not included and usually not necessary but credit scores can be purchased for a nominal fee if desired.

Once you have your credit report, review the entire report for accuracy.  Confirm your address and employment information are correct.  Verify the account payment histories are accurate.  Any discrepancies can be corrected by contacting the credit reporting service.  Also verify the account status is correct, i.e. are your closed accounts properly noted as closed.

Your credit report includes additional information under the Consumer Rights section.  Review what additional services are available and your rights.  For example, you can stop “prescreened” credit card solicitations by calling 888-567-8688 from your personal phone number (listed on the Personal Information section of the credit report) and following the voice prompts.

Credit fraud and identity theft are always a concern.  Most homeowner policies now offer identity theft coverage either as an included endorsement or at a reasonable additional premium.  Typically, homeowner insurance costs for identity and financial fraud are less than the protection available from other services.  Review and understand the different coverage options before purchase.

Credit repair services are suspect in most cases.  If you follow the above steps for correcting credit report discrepancies, additional services offered by the ‘credit repair services’ aren’t worth the cost.  The FTC site includes more information on this subject if needed.

Improving and maintaining an excellent credit report is essential.  Managing your credit improves your ability to borrow and the interest rates you will be quoted.  Your credit score can impact employment opportunities.  Minimizing your credit information exposure can only help reduce the likelihood of credit and/or identity theft.

Contact the FTC’s Identity Theft Hotline toll-free at 1-877-ID-Theft (438-4338).  The FTC put the information into a secure consumer fraud database and shares it with local, state, and federal law enforcement agencies.