It’s That Time Again: Check Your Annual Credit Report

by Kevin on January 14, 2009

If you are new to No Debt Plan this may be a new feature for you. Every three months I post up a quick reminder to check your annual credit report.

Why You Should Check Your Credit Report

It’s simple: your report shows all of the inquiries to your credit file as well as your open, paid late, delinquent, and past due accounts. Your credit file is used when you apply for credit — for a mortgage, car loan, or credit card. Poor credit leads to higher credit costs.

Unfortunately these reports can be rife with errors. So checking it can literally save you thousands of dollars. Imagine shaving 0.5% or 1% off of a mortgage loan because you fixed your credit report. That’s thousands upon thousands of dollars of interest you would save over the life of the loan.

How to Check Your Annual Credit Report

For starters I refuse to link to the garbage that you see on commercials on TV. The one that starts with an “f”. It sounds great because they claim you get your report at no cost… but they sign you up for a monthly monitoring service that costs money and is apparently difficult to cancel.

The alternative to the company that shall not be named is the government mandated Annual Credit Report website. Through this site you can access your credit report from each of the credit bureaus. The catch here is you only want to access on report every four months rather than all at the same time. This way you aren’t waiting a year in between seeing a new report, you get a new report every four months.

None of the reports you get from annualcreditreport.com (the government mandated website) will provide you with a credit score. All of the bureaus will try to convince you to purchase your credit score from them for a nominal fee like $7-10. I don’t recommend doing this.

Get Your Real Credit Scores

I don’t recommend buying your score from the individual bureaus because often they will give you “their” score. I know TransUnion does this. It’s “their” unique score which doesn’t match the typical credit score range. Thus, it is not much use to you.

Alternatively, you can get your real Fico Scores/Reports from MyFico. The reports can be pricey (at least compared to $7). They have a package that gives you all of your true scores and reports for $40 or so.

What to Look For

Essentially all you are looking for are incorrect entries. Is a creditor reporting you late on something that you are current on? That’s a problem. Is there a creditor listed that isn’t a current creditor of yours? That’s a BIG problem.

One thing to note: when you first sign in to use the Annual Credit Report website you go through a questionairre process to verify your identy. Questions like, “At some point in the past you lived on which street?” and then it lists four different streets, one of which you lived on in the past.

The questions aren’t usually surprising, but when we were still living in an apartment one of the questions asked us where we had a mortgage. We had no mortgage. We hadn’t applied for a mortgage. Ah, but the fourth option was “none of the above”. Whew!

{ 2 trackbacks }

It is soooo coold.. brr. Post Roundup | Bible Money Matters
January 14, 2009 at 10:21 am
Weekly Round-Up | Master Your Card
January 18, 2009 at 12:16 am

{ 3 comments }

Start-Up January 14, 2009 at 12:14 pm

It’s also good to keep your eye out for free credit scores from Equifax. So far over the past 4 months I’ve checked my credit score for free through Equifax. I usually find out about these deals through other bloggers or slickdeals.net.

Also, I’ve heard credit karma is a good way to check your score. You do have to provide a SS number, however, I’ve heard the security is very good.

Brittany January 14, 2009 at 11:48 pm

The link you posted for the FICO scores got a red flag from Web of Trust. Are you sure it’s the right link?

Russell Fascenda January 20, 2009 at 6:29 am

I also won’t mention the “f” company but their advertising always amuses me. The actors all appear to be about 19 years old. How much of a credit history is a 19 year old going to have?

The premise of the ads is great. Somehow knowing his credit report would have enabled this teenaged grocery bagboy with no education, no skills, no experience, buy a Corvette instead of a broken down Ford Pinto. How does that work exactly?

When did this whole credit history, credit score, obsession come about? I don’t ever remember knowing (or caring) about such things 10 years ago.

Comments on this entry are closed.