Why Do You Need An Annual Credit Report?

annual credit report

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Your Annual Credit Report Can Save You Money

Annual Credit Report Basics

A credit report is a summary of your financial activity. This activity is evaluated and assigned a number, which is your credit score. That score is used by mortgage companies, landlords, insurance companies, internet providers and utility companies to determine the rate or price they will charge you. Credit card companies use it to determine if you are creditworthiness. Employers even use your credit report to determine if you are financially responsible.

Catch Errors

When your financial activity gets reported the credit reporting agencies do not check the accuracy of that information. Incorrect information does not get reported maliciously but mistakes do happen. Errors on your credit report could be dropping your credit score, costing you money in higher interest rates, insurance premiums and other service fees.

Most Common Credit Report Errors

  • Credit card accounts that you paid off still show open.
  • Misspelled names, incorrect addresses or social security numbers resulting in accounts being opened in your name without your knowledge.
  • Accounts that should have been removed from your report are still listed. After 7 years, bankruptcies and delinquencies should be removed by credit card companies.
  • Incorrect payment status. You pay on time but the credit report shows you always pay late.
  • Debts from an ex-spouse are still listed on your report.

Your Next Step

You can get a free annual credit report from each of the 3 credit bureaus. Take advantage of that; a good credit score today does not mean it will be the same 6 months or a year from now. So self monitor your credit report to ensure that it is as accurate as possible and free of negative activity.

If you do find an error on your credit report you can dispute it online, a phone call or mail a letter. Even though online is the quickest method sending a certified letter with appropriate documentation to each of the 3 credit reporting companies will give you a good, solid trail. You should also send the same letter to the company that originally reported the error to involve them in the process.

Don’t delay, order your credit report today.