Smart Spending

Summer Beach Reading – Your Credit Report

While you are busy enjoying your summer, you should take a little time to get your credit report and look it over. Besides having some information on it that may not be the most interesting, you will find that there is hardly another document that can affect your finances and life so much as this one.

While it did not used to be this way, a credit report can show you what has been happening to your finances – possibly even without you knowing about it. If you have recently applied for credit, for instance, and were turned down, it is quite possibly the fault of your credit report and the information that it contains.

The Federal Trade Commission says that there are many things that are affected by your credit score. Since this document is often checked when you apply for things like credit, employment, an apartment, insurance, and more, it needs to be kept in shape if you want the best deals.

Experian says that you should check it before you make any financial decisions. This allows you to work on correcting any problems before applying for credit, which will help you get the best interest rates and the longest repayment terms.

Another reason to look at it, at least yearly, is because many people have had their identity stolen, for instance, and they did not even know it until either creditors started contacting them, or until they were rejected for new credit – even though – last they knew – their credit was fine. Regular checks on your credit ratings will show you where problems occur, and knowing about them will enable you to be able to correct real problems.

Because your credit report is so important, the government allows you to get a free credit report once a year from each of the three largest credit bureaus – Equifax, Experian, and TransUnion. You can only do this at the official website – You can also do this by phone and through email. The government warns that you need to ensure that you are at the right website before submitting any of your personal information, such as your social security number, because there are many imposter sites online. The official website does not send out any emails for you to respond to.

Besides being allowed to get one free copy of your credit report, there are also other occasions when a free copy would be available. For instance, the FTC says that you can get a copy when:

  • A company is taking adverse action against you.
  • When you have applied but are denied credit.
  • Unemployed and will look for a job within 60 days.
  • When identity theft is suspected or fraud is involved.
  • You are on welfare.

If errors are found, then the Fair Credit Reporting Act (FCRA) gives you the right to try and correct any errors with the company that reported it. Of course, if the statements are correct, then changes will not be made.

One of the best things you can do to help build a better credit score is to know the things that matter the most when calculating your score. You should not hastily try and do things like close credit cards or get new ones – including balance transfers – to try and change your credit score. All of these transactions are evident on your credit report. The action that counts the most is to always pay at least the minimum amount and always pay your bills on time.