A Must Do: Check Your Credit Report

Exercise, eat right, take your vitamins—and check your credit report regularly. The advice isn’t new, but it’s never been more important. Regularly checking your credit report is a key element of basic credit management.

The reason is simple: when it comes to getting the best rates for credit or insurance, or even getting hired for a job, decisions will be made based on the information in your credit report. In a survey released earlier this year by U.S. PIRG (the national lobbying office for state Public Interest Research Groups), one in four credit reports contains errors serious enough to cause consumers to be denied credit, a loan, an apartment or home loan, or even a job.

The survey also revealed that: 79 percent of credit reports contain mistakes of some kind; 54 percent include personal demographic identifying information that is incorrect; and 30 percent list accounts that have been closed as open. Consumers pay the price for this sloppy recordkeeping by being unable to get credit or having to pay higher interest rates because the mistakes falsely place them in the sub-prime, high-cost lending pool.

You should check your credit report with all three major credit bureaus at least once a year (contact information is at the end of this article). It’s important to check all three because you never know which one a creditor may use, and the information each bureau collects often varies.

On each report, check these items for accuracy:

Your name (or names, if you have changed yours due to marriage, divorce, or any other reason)

• Social Security number
• Date of birth
• Addresses of places you’ve lived
• Companies where you’ve worked
• Current open accounts
• Accounts that have been closed
• Pending accounts
• Records of delinquent payments or other problems

Check to make sure that no negative information is on your report longer than allowed by law. Suits and judgments, arrest records, and most other unfavorable information must be removed after seven years. Tax liens must be dropped seven years after the lien is paid in full. Bankruptcies must be removed after ten years.

Notify the credit reporting agency of any inaccuracy; they are required by law to correct errors promptly and without damage to your credit rating. Keep copies of all correspondence and make detailed notes of telephone conversations. If false information is not removed from your credit report, you may be able to sue for actual and punitive damages under the Fair Credit Reporting Act.

Here’s how to contact the three major credit bureaus (credit reporting agencies):

Equifax
Equifax Credit Information Services, Inc
P.O. Box 740241
Atlanta, GA 30374
To order report: 1-800-685-1111
To report fraud: 1-800-525-6285
Web site: www.equifax.com
Experian (formerly TRW)

National Consumer Assistance Center
PO Box 2002
Allen, TX 75013
To order report: 1-888-397-3742
To report fraud: 1-888-397-3742
Web site: www.experian.com
TransUnion LLC

Consumer Disclosure Center
P.O. Box 1000
Chester, PA 19022
To order report: 1-800-888-4213
To report fraud: 1-800-916-8800
Web site: www.transunion.com