Checking your credit report annually can save you from a mountain of financial troubles. Not only does it show you what creditors see when you apply for credit, but it helps you spot suspicious activity on your credit accounts. The Federal Trade Commission recognizes these benefits, which is why it allows you to check your credit report for free every year. Unfortunately, this doesn't include free access to your credit score.
Fair Credit Reporting Act
Under the Fair Credit Reporting Act, you may access your credit report for free once every 12 months through AnnualCreditReport.com (see Resources). This is the only site the FTC endorses to provide free credit reports. AnnualCreditReport.com allows you to see your credit report from each of the nation's leading reporting agencies --- Experian, TransUnion and Equifax --- but not to see your credit scores from these agencies. For that, you must purchase your score from the agencies themselves.
Accessing Your Score
As of 2011, it costs at least $10 to see your credit score from one agency. Experian lets you see your score from all three agencies for about $40, while you can get your FICO credit score from myFICO.com for about $20. Your credit score can vary as much as 40 points between agencies according to TrueCredit.com, which is sponsored by TransUnion.
Improving Your Score
Since they use the information on your credit report to assign your credit score, agencies don't show you your score without also showing you your report. By reviewing your account, you can determine whether or not you should improve your credit habits. The single most damaging thing you can do to your credit is to make late payments. The most damaging thing next to this is to have a high debt-to-credit ratio.
If your score is 720 or higher, it doesn't need improvement. According to CBS's "The Early Show," creditors consider scores from 720 to 850 to be the same. If it's below 700, work to improve it.
Reporting False Information
You may improve your credit score by having false information removed from your report. Such information may include misspelling of your name or a credit card account you never had, for example. Call the agency responsible if you find false information. Even if it doesn't improve your score, ensuring that your information is correct can help combat identity theft.
0 comments:
Post a Comment