I don’t ask for much. In fact, I hardly ever ask you for anything at all. And I can’t think of the last time I demanded something from you. So please know that this comes from a place of genuine caring and concern.
You need to pull a copy of your credit report. Today.
I’m not badgering you about this just for kicks. This is important. Only about 20 percent of you are reviewing your credit report on an annual basis. That’s not really good enough.
What’s the big deal?
Fair question. Let’s start with the two big ones: fraud and reporting errors. We both know how important your credit history is to your financial wellbeing. That’s why you work so hard to build it up. Well, that beautiful credit history can be dangerously undermined by forces outside of your control.
Sounds treacherous, right? That’s because it is. Your identity could be compromised – it happens to nearly 10 million people every year – and your credit put into serious jeopardy.
If there’s been some sort of fraudulent activity the sooner you know about it, the better. On average, it takes about 30 hours and $500 to undo the damage of identity theft, but the longer it goes on, the worse it will be. So look today!
Regular old reporting errors, while slightly less insidious, can be just as damaging, especially if you’re about to make a big purchase and need your credit to be sparkling.
Even if nothing’s wrong, there’s still a lot of value in reviewing the information contained within your credit report. You already know the steps necessary to build a strong credit history. Looking at your credit report can tell you if you’re making progress.
Reviewing your credit report only takes a few minutes, but it can make an enormous difference to your overall financial health.
Alright, what do I do?
I knew I’d wear you down eventually. Getting a copy of your report is simple. There’s actually quite a few different ways to obtain your credit report, but AnnualCreditReport.com is a great place to start.
All consumers are entitled to one free report from each of the three major credit reporting agencies (Experian, TransUnion, and Equifax) every single year. You need to provide some basic identifying information and choose which report you wish to receive. After that you’ll answer a few basic questions about the account information on your report and presto! Your credit report has arrived.
So what am I looking at?
Your credit report will contain a lot of information and you should really review all of it. If you wanted to prioritize, however, the most important part is probably your account history.
Take a look at every credit account listed in your name and make sure they’re all legitimate. If the name doesn’t look familiar, look at the date the account was opened. That might help jog your memory. If you’re sure you didn’t open one of the listed accounts, you can dispute the account directly with the reporting agency.
The accounts might all be legitimate, but that doesn’t mean the charges are. Review the historical balances on each account, especially accounts you don’t use frequently, and verify that the amounts owed look accurate.
Also scan the payment history while you’re there. Missed payments can do major damage to your credit score. If your credit report shows missed payments that don’t seem correct, double-check with your creditor statements to verify.
Beyond your creditor accounts, make sure the addresses listed are all places where you actually lived. Strange addresses may be signs that your identity has been compromised.
I found something that doesn’t look right – what do I do now?
First you’ll want to file a dispute with the credit reporting agency. You’ll have the option to file your dispute online, over the phone, or through the mail. The agency will then notify the creditor in question, who will have 30 days to verify whether or not the disputed notation is correct.
While that’s in motion, it’s not a bad idea to pull reports from the other two reporting agencies to see if the error appears elsewhere. If it does you’ll have to file separate disputes with each agency.
All nagging aside, looking at your credit report is about as easy as can be and can save you from some big time financial headaches. So go do it. For me. But mostly for yourself.
But a little bit for me. I ask so little...