Get a Free Copy
of Your Credit Report Starting March 1
Starting March 1, consumers in
the Midwest will be able to obtain a free copy of their credit report each
year from all three major U.S. credit bureaus: Equifax, Experian, and
TransUnion. While you may not have thought much about your credit report
before, think again.
Your credit report can affect
your ability to secure a loan or a service-such as from an orthodontist-or
even land a job. And, your credit report may be used to determine the rate
of interest you are charged on a loan, which could mean thousands of
dollars in savings for you and your family.
"Checking your credit report
may not seem like a high priority in our lives, but it really should be,"
explains Jody Anderson, director of financial and housing counseling for
LSS Financial Counseling Service. "We need a positive credit history to
secure loans and get the best interest rates possible. More employers are
also looking at credit reports to gauge a prospective employee's
reliability or skill level in money management for jobs in finance, for
example."
Checking your credit report
annually can also help you determine whether you need to develop a
get-well plan to improve your score or repair any credit problems,
Anderson said. "You don't want to be surprised when you go to your bank
for a loan and are turned down because of poor credit history or a low
credit score," Anderson said.
Credit reports are divided into four categories: 1) personal
identification information, 2) credit history, 3) public records
(including bankruptcies and judgments) and 4) inquiries into your credit
report by banks and other financial institutions or prospective employers,
who may want to use the information to make a hiring decision.
Anderson says that credit
reports almost always have errors in them and, for that reason alone,
should be reviewed and updated each year. Checking your credit report can
also help you spot identity theft-or whether your credit cards or other
personal information has been stolen and used without your knowledge.
When you go to the bank to
secure a loan, lenders will check your credit score using a service like
the Fair Isaacs Corporation (FICO), which ranks credit scores from 300 to
850. Lenders consider you a better credit risk when your score is high.
Your credit score is calculated using information in your credit report.
While checking one credit
report is generally sufficient before applying for a small loan, accessing
a copy of your credit report from all three of the major credit bureaus is
especially important if you're planning on buying a home or want to secure
a major loan for some other purpose.
The new free credit report
service is only accessible through one central website, toll-free
telephone number, or mailing address. To order:
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On-line, go to
www.annualcreditreport.com
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By phone call 877-322-8228
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By mail, complete the Annual
Credit Report Request Form (found at
www.ftc.gov/credit) and mail it to: Annual Credit Report Request
Service, P.O. Box 105281, Atlanta, GA 30348-5281
You can choose to get a copy
of all three credit reports at the same time, or stagger them. By
accessing all of your credit reports at the same time, you can compare
them and check for errors. By getting copies of your credit reports at
different times throughout the year, you can check to see if any changes
you've made have been rectified on your reports.
But even when you get a copy
of your credit report, you may have difficulty reading it. There may be
terms like "charge-offs" and "trade lines" that you don't understand.
If you need help understanding
your credit report or determining how to improve your credit score, the
LSS Financial Counseling Service offers a new service called a Credit
Report Review that can help. Through this service, professionally-trained
financial counselors can help you understand your credit report, provide
you with a credit score, and help you determine how you rank as a credit
risk. They can also provide guidance in fixing errors, filing a dispute,
or devising a plan to improve your credit score if it's low.
The cost for a credit report
review ranges from $30 to $80, depending on the number of credit reports
reviewed. Individuals are required to make an in-office visit and bring
photo identification.
In addition to a credit report
review, the LSS Financial Counseling Service offers free budget
counseling, financial education and confidential debt management planning
via in-office appointments, phone counseling or the Internet. LSS
Financial Counseling Service is a member of the National Foundation for
Credit Counseling (NFCC). For more information, call 1-888-577-2227 or
visit www.lssmn.org/debt
