Check Your Annual Credit Report

by Kevin on January 7, 2008

It’s 2008 – a New Year. I keep a loose schedule of financial tasks I need to complete throughout the year. At the top of the list for early January is checking your annual credit report.

A credit report details out all accounts involved in your personal financial life. These reports are utilized in determining whether or not you are a credit risk for a loan (car loan or mortgage). It details all of your personal information (address, employer, spouse, etc.), as well as what inquiries have been made toward your name. Inquiries are usually fine — it is just credit card companies checking your report; this helps them determine on whether or not to send you a pre-approved letter in the mail.

Let me emphasize: I am not a fan of consumer debt, car payments, and risky sub-prime mortgages. Debt is usually bad. However, there is a use to credit. I’ll discuss this in later posts. To get useful credit, you need an accurate and ‘good’ credit report.

With a report this important, you would expect the three credit agencies (Experian, TransUnion, and Equifax) to have everything down just right. Think again. Credit report errors are reportedly pretty common. You always think, “Yea, but everyone else’s report is incorrect. Mine is spot on.”

Well, that’s what I used to think, too. I checked my report and discovered several errors that I had not caught before. My address was incorrect – we just bought a house this year. My employment information was incorrect – I switched jobs in 2006! Even the spouse information was incorrect, in a somewhat humorous way. My Mom was listed as my spouse because she co-signed on my first car loan when I was 17. Needless to say I put a dispute report in very quickly.

Disputing is a relatively easy process. You can always call a customer service rep with your dispute; I sent mine in online. Within a few days I had an e-mail reply saying my information had been changed. It took maybe 10 minutes of time, but now I know my report is accurate and complete.

We also checked my wife’s report. We discovered several errors – her address was incorrect, and I wasn’t even listed as her spouse. We’re getting this cleared up, too.

Note: I recommend using AnnualCreditReport.com. This is the free service that the credit bureaus offer. You have to pay extra to receive your credit score, but cleaning up your report should suffice. I do not recommend freecreditreport.com. That site is designed to get you to pay a monthly fee to monitor your credit. This is unnecessary. Simply monitor one report from each agency every 4 months. (January 1, May 1, September 1).

{ 1 comment }

Coupon Fetcher January 10, 2008 at 11:06 am

Great advice. With the advent of the free credit report it is a must that you check your credit report. Never heard of Annual Credit Report.com, I will give it a try. Thanks for the link.

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