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- Your credit report is a detailed log of all of your lines of credit and credit-based activity, like taking out a mortgage loan or opening a credit card.
- There are three credit bureaus, each of which create their own report – Equifax, Experian, and TransUnion – and use it to help lenders decide whether you’re a good candidate for credit.
- Credit reporting mistakes happen, though, and they could cause serious problems – like the inability to qualify for financing.
- For that reason, you should get in the habit of regularly checking your three credit reports. Ideally, you’d do this at least once a quarter if not once a month.
- Checking your credit reports frequently puts you in a position to react quickly when and if fraud or credit reporting errors occur.
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Your credit report is a detailed log of all of your lines of credit and credit-based activitly, like taking out a mortgage loan or opening a credit card. There are three credit bureaus, each of which create their own report – Equifax, Experian, and TransUnion – and use it to help lenders decide whether you’re a good candidate for credit.
These credit reports can have a significant impact on your overall financial picture. With good credit, you may be able to secure lower interest rates on financing and save money every month. Good credit can make it easier to get approved for the things you need, too, like an apartment lease, mortgage, or auto loan.
Because your credit reports are so important, it can be a big deal when mistakes and errors happen. If a credit reporting mistake occurs, it could cost you more money or make it difficult to secure housing, transportation, and sometimes even job opportunities.
Here’s the good news. You have rights when it comes to credit reporting. Namely, the Fair Credit Reporting Act (FCRA) gives you the right to expect fair and accurate information to show up on your credit reports.
But you also have responsibilities under the FCRA. If mistakes occur (and they often do), it’s up to you to contact the credit bureaus with a dispute. But first, you’ll probably need to check copies of all three of your credit reports to find out what’s on them.
How often should I check my credit report?
Credit reporting errors happen more frequently than many people realize. A Federal Trade Commission study found that one in five Americans has an error on a credit report.
The best way to discover whether you have credit reporting errors is to check your three reports from Equifax, TransUnion, and Experian. The FCRA gives you the right to claim a free copy of each of your credit reports from all three credit bureaus once every 12 months. To exercise this right, visit AnnualCreditReport.com.
But if you want to make sure that your credit reports stay accurate, checking them once every 12 months isn’t nearly enough. You should check your credit reports at least once a quarter, and once a month is probably best.
Where can I check my credit report?
When you plan to check your credit reports quarterly or monthly, you’ll need to find other ways to access your information. While AnnualCreditReport.com is a great place to access your reports, the number of free reports you may be able to claim each year is limited to one from each bureau.
You can also check some version of your credit reports through:
- Credit Karma: free credit reports and scores from Equifax and TransUnion
- Experian: free Experian credit report with available upgrades
- My Credit Guide from American Express: free credit report and score from TransUnion, whether or not you’re an Amex cardholder
- myEquifax: free Equifax credit reports per year; additional reports and services may be available for a fee
- Credit.com: free Experian credit report snapshot
- Bankrate: free TransUnion credit report and score
In addition to the resources above, you may be entitled to more free credit reports under the following circumstances:
- You’re a victim of identity theft
- You receive public assistance
- You’re unemployed
- You were denied for credit or insurance in the last 60 days
All three of the major credit reporting agencies also provide free electronic credit monitoring services to active-duty service members and National Guard members as of October 31, 2019.
Should I pay to monitor my credit?
Some companies – including Experian, Equifax, and TransUnion – offer fee-based credit monitoring services, as well. These services commonly range from around $10 to $35 per month. (Note that Credit Karma offers credit monitoring for free.)
With so many free ways to claim your credit reports and scores, you might wonder why anyone would ever pay to access or monitor their credit reports. But if you can afford the extra cost without putting any strain on your budget, fee-based credit monitoring may come with some perks you’d enjoy, such as:
- More information: AnnualCreditReport.com will provide you with detailed data about the accounts that appear on your three credit reports. Reports obtained directly from the credit bureau will likely do the same. However, the reports you access from other free websites might only provide you with summaries of the information found in your credit files. When you pay for credit monitoring, the reports you receive often contain more detailed information.
- Three-bureau credit reports and scores at once: Visiting multiple websites to access your three credit reports and scores can be time-consuming. Some, though not all, fee-based credit monitoring services combine all three of your reports and scores into one convenient report. Not only that, but you may also be able to view an updated copy of your three reports and scores as often as once a month. (Offers vary. Be sure to carefully review the terms and conditions of any service before you sign up.)
- Three-bureau credit monitoring: Depending on the credit monitoring service you select, you may receive a notification when something changes about your credit. These changes might include new credit inquiries, new negative information, or movement in your credit scores. If you sign up for three-bureau credit monitoring, the service might help you monitor your reports from Equifax, TransUnion, and Experian.
- Identity theft insurance: Some fee-based credit monitoring services come with identity theft insurance. Identity theft insurance can help cover some of the costs associated with identity theft if this crime ever happens to you. For example, as a victim, you might be able to file a claim for expenses related to credit monitoring services, legal fees, lost wages, and more. Be sure to read the terms and conditions of any policy before you sign up so you can understand what type of protection it may provide.
- FICO credit scores: Most credit scores provided through free credit monitoring services are VantageScore credit scores. VantageScore is gaining ground and becoming more relevant with each passing year. Still, the fact remains that 90% of top lenders use FICO Scores when making lending decisions. Some fee-based credit monitoring services, such as myFICO, offer you a chance to review your FICO credit scores each month.
Frequently checking all three of your credit reports is a wise habit to create. You don’t have to pay for a credit monitoring service if you don’t want to do so. Yet it’s crucial to look through your credit reports for errors regularly. Even if you pay for credit monitoring services, you should manually go over your three reports yourself from time to time.
Credit monitoring won’t stop someone from stealing your personal information. It won’t prevent a thief from opening a fraudulent account in your name, either. (Though, a credit freeze may help with that situation.) Yet routine credit report reviews can allow you to discover if fraud or credit reporting mistakes occur. Once you know there’s a problem; you can take action quickly to try to fix it.
Michelle Lambright Black, founder of CreditWriter.com and HerCreditMatters.com, is a leading credit expert with over a decade and a half of experience in the credit industry. She’s an expert on credit reporting, credit scoring, identity theft, budgeting, and debt eradication.