Checking Your Credit Report
It’s free, so no excuses!
The first step on the path to financial well-being is getting a look at your credit history.
Your credit history is a snapshot of all your credit card debt, if any, wrapped up in a credit report. Once you've seen it, you'll want to check it regularly so that when you're ready to buy something like a house or a new car, you'll know how good your credit is.
Another reason to check your credit report regularly is to see if anyone else is trying to use your personal information.
What’s in a credit report?
Your credit report helps lenders understand you as a credit risk and decide whether to lend you money or not. The agencies that report your credit gather information about you and your credit history. The following types of details will be in your credit report: ¹
- Your name, address, Social Security number and marital status
- A list of people, companies or organizations who have requested your credit history in the past six months
- A list of the mortgages and charge cards you have, how long you've had them, and their repayment terms
- The dollar limits on each account, what you currently owe, the date of your most recent payment, and how often you've been late with the payments
- Past accounts, paid in full but now closed
- Any defaults on previous credit, such as bankruptcies, repossessions, liens, and foreclosures*
- Who owes the debt − you alone, you and a joint borrower, or you as a co-signer
- Bill disputes
To check your credit report, request a copy from the credit reporting agency of your choice.
Solving credit problems
You can now get a free printout of your credit report once every 12 months. If you find an error, contact the reporting agency to check the information and find out how to correct any mistakes.
If you do run into a problem with your credit, consider the following: ²
To contest an item on your credit report, contact the appropriate company in writing and send it “return receipt requested.”
- Include your name, account number, the dollar amount in question, and the reason you believe the bill is wrong.
- If in doubt, request written verification of a debt.
- Keep all your original documents, especially receipts, sales slips, and billing statements. Send copies only. It may take more than one letter to correct problems.
- Be skeptical of businesses that offer instant solutions to credit problems.
- Be persistent. Resolving credit problems can take time and effort.
- There is nothing a credit repair company can do for you − for a fee − that you can’t do for yourself for little or no cost.
The last thing you want to deal with is an unjustified black mark on your credit report. You'll find it well worth your time to review and update your credit report regularly. Then, you can look forward to that new home or car with greater peace of mind.
¹ http://homebuying.about.com/cs/credit/a/credit_report.htm, retrieved July 2005
² Federal Trade Commission, "Credit and Your Consumer Rights," 2005. Accurate negative information can be included on your credit report for a maximum of seven years; bankruptcies can be included for 10 years.