Use
Your Free Credit Report To Check Your Financial Health
by James H. Dimmitt
As of Thursday, December 1, 2004, one-third of Americans can now
access their credit reports from all three main credit agencies for free. Passed
in late 2003, the Fair & Accurate Credit Transactions Act creates a central
source consumers can use to obtain a free annual credit report.
Equifax, Experian, and Transunion,the three largest credit
reporting agencies, have set up a special site where consumers can request,
view, and print their free report. That site is
http://www.annualcreditreport.com and is the only authorized site to request
your free report(s).
Those without internet access can call toll-free at 877-322-8228
or write to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA
30348-5281 to request their report(s). This service, which begins in the west
coast, will eventually cover all the states by September 2005.
Here are 4 tips to help you check your financial health with
your free credit report:
Tip #1- Check for Errors
The first thing you need to do is carefully check that your
credit report is accurate. Nearly 70% of credit reports contain errors.
These errors may be as simple as an incorrect middle initial or
address. Or it could be as serious as a creditor reporting that you were late
with a payment when in fact you were not late at all.
This error might not seem like a big deal to you. However,to a
future lender like a mortgage company, it makes a big difference!
Carefully examine your credit report and if you find an error
contact your creditor and the credit bureaus in writing. Catch and correct these
errors now before it hurts your chances of securing credit in the future.
Tip #2 - Correcting Errors
The two most common errors contained in credit reports are:
1)
wrong account information
2)
incorrect recording of late payments.
If you find an account reported that does not belong you,
contact the credit grantor or issuer immediately. Remember, finding accounts
that you have not personally opened is a sign of possible identity theft.
Hopefully you'll discover that this error is nothing more than
an oversight and not an identity theft problem. Most often this occurs when an
account belonging to a family member or someone with a similar name is reported
on your credit report.
If your problem is an error in reporting a late payment you will
need proof to back up your case before this error can be corrected or removed.
The most common error occurs when a payment is reported as "late" when it was
actually a current or "on time" payment.
You will need to correct the error by contacting them in
writing. Keep a journal or log of all calls and correspondence made to your
creditors and credit bureaus.
The Fair Credit Reporting Act (FCRA) requires the credit bureaus
and the agency reporting the information to correct inaccurate information in
your credit report. Therefore, it is important that you contact both the credit
bureau and the creditor whose information is in dispute. Again this must be done
in writing to protect your consumer rights.
You can use the sample letter in this article to help settle
your dispute. Make sure that you clearly identify the information that you
dispute, include copies of receipts or documents that support your position.
Then request that the information be corrected or deleted from your file.
Send your letter by certified mail and request a return receipt
from the recipient. Keep copies of all correspondence that you send. You'll have
to give the agencies involved a minimum of 30 days to begin their investigation.
Once their investigation is complete, they must notify you of
the results. Although the process will take time, it's important to do it. This
is your credit profile, your "consumer identity" that is at stake. Don't expect
an error to correct itself.
At your request, the credit bureaus must send notices of
corrections to your credit profile to anyone who has requested your report in
the last six months. If you applied for a job and were turned down because of
inaccurate information in your credit report, you can have the corrected report
mailed to anyone who received a copy of your credit report in the past two
years.
Date
Your Name
Your Address
Your City, State, Zip Code
Complaint Department Name of Credit Reporting Agency Address City, State,
Zip Code
Dear Sir or Madam:
I am writing to dispute the following information in my
file. The items I dispute are also encircled on the attached copy of the
report I received. (Identify item(s) disputed by name of source, such as
creditors or tax court, and identify type of item, such as credit account,
judgment, etc.)
This item is (inaccurate or incomplete) because (describe
what is inaccurate or incomplete and why). I am requesting that the item be
deleted (or request another specific change) to correct the information.
Enclosed are copies of (use this sentence if applicable and
describe any enclosed documentation, such as payment records, court
documents) supporting my position. Please reinvestigate this (these)
matter(s) and (delete or correct) the disputed item(s) as soon as possible.
Sincerely,
Your name
Enclosures: (List what you are enclosing)
Originally Posted at
http://www.ftc.gov/
Tip #3 - Making a major purchase
If you are considering a major purchase such as a car or a home,
checking your credit report gives you the chance to see what a potential lender
sees and uses to judge your credit worthiness.
You want to make sure that your credit report is accurate before
you apply for that sports car or new home. Errors or problems can be corrected
before your lender can use those against you and deny your credit request.
You'll also have a better idea of what type or rate of credit you should expect
from a potential lender.
Tip #4 - Check your credit report regularly
Check your credit report regularly. Guard your "consumer
identity" as you would anything else you treasure. Use your credit wisely, along
with these tips, and you will enjoy the benefits that your good credit and your
good name deserve now and for years to come.
©, www.yourfreecreditreportnow.com Author: James H. Dimmitt James is editor
of "To Your Credit", a weekly
FREE newsletter for consumers like you. Subscribe to "To Your Credit" at http://www.yourfreecreditreportnow.com