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How to Check (and Understand) Your Credit Report for Free

how to check your credit report for free

Credit scores seem to get all the hype, but – surprise, surprise – your credit report is actually much more important overall. That’s because your credit report is the reason your credit score exists – it’s what your number is based on. Given its financial significance, if you haven’t checked your report lately (or ever) there’s no time like the present. It’s very easy to check your credit report for free and I highly recommend you check it annually at an absolute minimum.

It’s important to periodically check your report because you want to make sure it’s accurate. If there’s any missing or incorrect information, those discrepancies could lead to all kinds of problems. For example, a lower credit score than you deserve and, consequently, less favorable interest rates, fewer financial opportunities, and even higher car insurance rates.

In addition, you want to double check your report to help prevent and identify identity theft. If you see accounts that you didn’t open, you’ll know you’ve been a victim. Knowledge is power – once you know there’s a problem, you can work to get it fixed. More about correcting errors on your report here.

How to check your credit report for free

Back in 1970, congress passed the Fair Credit Reporting Act – a federal law that regulates consumer credit information and provides for access to credit reports. Because of the FCRA and a 2003 amendment – the Fair and Accurate Credit Transactions Act, or FACTA – all consumers have the right to check their credit report annually, for free, from each of the three major credit reporting bureaus—Equifax, Experian and TransUnion.

Since there are 3 credit reporting bureaus, you actually have 3 separate reports. They don’t all collect the exact same information so there may be small differences between them – that’s okay as long as there aren’t inaccuracies.

You can either check all three of your reports at the same time or stagger your requests throughout the year. I personally pull one report every 4 months, typically in January, May, and September, so that I’m always aware of what is being reported and can quickly correct any misinformation.

The only authorized place to get your free reports online is www.annualcreditreport.com. In addition, you can call 877-322-8228 or print a request form and mail it to the address shown on the form.

A couple of things:

  • Don’t be fooled by similar websites using the word “free” in their web address or page title, and don’t bother with any site that offers a free report in exchange for something else – i.e. signing up for a free trial of credit monitoring, etc.
  • Be prepared to answer some questions about your financial history for identification purposes. Previous addresses you’re associated with, loans or mortgages you have or one had, etc. (I literally pulled my TransUnion report as I was typing up this post. I filled in my name, address, birthday and social security number, then answered 3 quick questions. Easy peasy.)

Other ways to obtain a free report

In case you’ve already received your free annual report, here are a few other reasons that you might qualify for an additional free report:

  • Your credit report is inaccurate because of fraud or identity theft
  • You’ve been denied credit, insurance or employment (you must request your report within 60 days of the denial)
  • You’re unemployed and plan on looking for work within 60 days
  • You’re on welfare

If any of these apply to you, you’ll need to contact each of the credit bureaus directly. Here are the numbers to call:

  • Equifax – 1-888-548-7878
  • Experian – 1-888-397-3742
  • TransUnion – 1-800-916-8800

Information on your credit report

Your credit report includes a huge amount of information about your financial history. It’s generally divided into 4 -6 major categories:

  1. Personal identification information
  2. Credit account history
  3. Collection items*
  4. Public records
  5. Inquiries
  6. Statements of Dispute*

*These will only show up on your report as applicable.

Personal identification information

The personal identification section contains information derived from your credit applications. You’ll need to report any errors in this section directly to the applicable credit bureau for corrections. Included are your:

  • Name, including variations (i.e. maiden names)
  • Social Security Number 
  • Date of birth
  • Current and previous addresses
  • Current and former employers (sometimes but not always)
  • Telephone numbers (again, sometimes but not always)

Credit account history

This section provides a very detailed look at all of your credit history – closed accounts as well as current ones. Your credit report will list all of your accounts, including mortgages, installment accounts (such as student or vehicle loans) and revolving accounts (i.e. credit cards).

Any accounts with adverse or negative items will typically be listed first (and labeled as “adverse” or “potentially negative”). Those that are in good standing will be listed next – TransUnion labels these “Satisfactory Accounts”, while Experian lists them as “Credit Items”.

Information reported for each account will include most or all of the following, and maybe some additional items as well (Equifax also reports your debt-to-credit ratio for example):

  • Creditor name and account number
  • Account owner (or “Responsibility”) – this will indicate if you’re responsible for the account or only an authorized user
  • Type of account – revolving, installment, or mortgage
  • Account terms – paid monthly (revolving), or for x number of months (installment & mortgage)
  • Date reported – this is the date that the credit bureau last received information for a particular account
  • Credit limit – self explanatory
  • High credit (or high balance) – this indicates the highest balance that was ever reported as owed on your account during a specified period
  • Balance – your current balance
  • Scheduled payment amount – this is your minimum balance due
  • Actual payment amount – again, self explanatory
  • Amount past due – hopefully this is $0
  • Date the account was opened (and closed if applicable)
  • Date of last activity and your last payment
  • Date of any delinquencies, charge off amounts, etc.

Your actual history will look like a grid or calendar with each box representing a month and year. Each report will look a little different – this is taken from my own TransUnion report:

You can see my monthly balances and my minimum (scheduled) payment due. Some accounts will report the actual payment made as well. Green boxes mean I’m in good standing and I have no past due balances (because I always pay my cards in full each month. Always).

Here’s a section indicating on time payments to another card from one of my previous Equifax reports:

For this account you can see that again, green means good. If a payment hadn’t been on time, there are a bunch of specific indicators to report how late it was, whether it’s in collections, or if there was repossession for example.

Collection Accounts

If you have any accounts that have gone to collections, they will be listed. You will want to be especially careful to make sure this section is accurate since it is negatively affecting your credit score.

Not sure what this account status means? Essentially, if you’re late on payments to such a degree that a creditor doesn’t think that you will pay at all, they may turn you over to collections. This means that they sell your debt to a collection agency; the collection agency will then try to collect the debt from you – sometimes using aggressive or shady tactics.

Be aware that there are laws in place to protect consumers in these situations. You can read more about your rights covered under the Fair Debt Collections Practice Act here.

Public Records

This section will list information on any judgements, bankruptcies, liens, foreclosures and even wage garnishments. These can be on the federal or state/city level. Most public records items can stay on your credit report for seven years. Chapter 7 bankruptcy is an exception though – it can stay on your report for up to 10 years.

Again, make sure that if there’s any information in this section that it’s correct because it is damaging to your credit score and your financial health.

Inquiries

Anytime anyone reviews your credit report it gets recorded on your credit report. Inquiries can be either “hard” or “soft”. Hard inquiries DO affect your credit score; soft inquires DO NOT.

  • Hard inquiries – these are authorizations that you’ve provided which allow others to look at your report. You can think of these as “application” inquiries. When you apply for a loan, credit card, mortgage, etc., a hard inquiry is recorded. Hard inquiries stay on your report for 24 months but can only negatively affect your credit score for 12 months.
  • Soft inquiries – these are inquiries that don’t affect your credit score. Checking your own report or score is a soft inquiry and does not affect your score or your credit – I pinky promise. Other soft inquiries include periodic reviews of your history by a current creditor or lender and promotional inquiries (the reason you get all those credit card and balance transfer offers in the mail).

What to do in case of errors

If you find any errors, omissions, or discrepancies on any of the three reports, you’ll want to get those corrected, asap. For more on who to contact and how to report issues, see this post next.

Actionable money moves

  1. If you haven’t done so already this year, go to AnnualCreditReport.com and download one (or 2 or all 3) of your credit reports.
  2. Check your credit report(s) thoroughly for any errors, omissions, or inaccuracies.
  3. If you find any issues, follow this link to find out exactly how to correct them.

Questions? Advice to share? Let me know in the comments!


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