GET YOUR FREE ANNUAL CREDIT REPORT
Checking your credit on a regular basis is important to maintaining a healthy credit profile. Even more so when your about to buy your first home. At the first thought of buying a home definitely pull your free annual credit report.
By getting your hands on your credit report early, you have time to check for mistakes and fraud that could be impacting your credit score.
Accessing your free annual credit report early will also give you time to take some measures to improve your credit score. Depending on your credit profile, some minor tweaks can have a significant impact on your credit score.
Under The Fair Credit Reporting Act (FCRA) the federal government has mandated you have access once a year( every twelve months) to get a free credit report from each of the three credit agencies…. TransUnion, Experian and Fair Isaac.
Starting in 2020 you can order up to 6 reports a year through 2026.
The purpose of your free annual credit report is to be able to see what derogatory credit is being reported against you. You have a right to know what is being reported and affecting your credit profile.
WHY SHOULD I GET MY FREE ANNUAL CREDIT REPORT?
If you are going to be applying for credit, your credit score plays a major role in your credit approval as well as the interest rate and terms of the loan.
When buying a home about every 20 points of credit score can impact your interest rate on your mortgage. Not only will your credit score affect your interest rate, but it will also impact what you pay in Private Mortgage Insurance and Homeowners Insurance as well. Having a great credit score can save you hundreds of dollars a month when buying a home.
Going beyond buying a home, your credit score will also impact your interest rate on car loans, credit card offers, automobile insurance and even your ability to get a job in some financial sectors.
Maintaining a good credit score can save you 10’s of thousands of dollars over a lifetime.
HOW DO I GET MY FREE ANNUAL CREDIT REPORT?
To order your free annual credit report go to www.annualcreditreport.com or call 1-877-322-8228. You can also submit a request by mail.
You can order your report from one bureau or all three at the same time. Each agency gets its information from different sources and the information can be slightly different.
If you apply online access to your credit report should be instantaneous.
BEWARE OF IMPOSTER SITES OFFERING FREE CREDIT REPORTS
There is only one site is authorized by the federal government to offer a free annual credit report. That is www.annualcreditreport.com.
Beware of other sites offering a free credit report. There are usually strings attached. Often it ends up costing you money to get full access.
www.annualcreditreport.com will never email you or call you looking for information. If you get a call it is probably a scam. Do not give out personal information.
WHAT INFORMATION WILL I NEED TO PROVIDE TO GET MY FREE CREDIT REPORT?
You will need to provide your address, social security number and birth date as well as residency information.
You may also be asked about use on some trade lines that only you would know to verify it is you.
WHAT SHOULD I BE LOOKING FOR ON MY FREE CREDIT REPORT?
You should be looking for fraud and mistakes on your free annual credit report.
Check and verify all of your personal information is correct.
Look for tradelines that you are not familiar with. If you find open trade lines that you have no idea of what they are, someone is probably fraudulently using your information.
Review each tradeline, whether they are open or closed and check for inaccuracies. Mistakes are made that can impact your credit score. Mistakes are more common than you think.
WHAT DO I DO IF I FIND SOME INACCURACIES?
Under the law, each credit reporting bureau and the information provider are to investigate all disputes and make any corrections to inaccuracies.
Write to each bureau explaining the problem. The credit bureau has 30 days to investigate the item in question through the information provider. If the provider finds the information inaccurate they must report a correction to all of the bureaus.
Make sure any discrepancies you dispute are accurate. Don’t submit frivolous claims.
IMPROVING YOUR CREDIT SCORE
Maybe you don’t have any inaccuracies on your credit report, but you don’t have the best credit profile. Here are a few things you can do to improve your credit score after reviewing your free annual credit report.
- Check your credit often for inaccuracies. Correct any inaccuracies immediately.
- Make sure you pay your bills in a timely manner. This is a huge factor in improving your credit. Recent derogatory credit impacts you far greater than derogatory credit that is several years old.
- Keep your credit use under 30% of your available credit. Don’t max out your credit. If you must use credit spread it around.
- Don’t close old credit accounts that aren’t being used. Age of credit is very important.
- Vary your credit usage so you don’t have just one type of credit.
- You need to use your credit but do it with caution. Using a credit card and paying most of it off every month is good.
- Avoid constantly having your credit pulled.
SUMMARY
Your credit profile is important and maintaining it at healthy levels is even more important. Utilize your free annual credit report as a tool for keeping an eye for fraud and mistakes on your credit report and to help improve your credit profile.
If you are working with an experienced buyer’s agent, they will automatically know what questions to ask and help you interpret all of the information. There is no need to go it alone.
OTHER RESOURCES:
- Your credit score is important when you are buying a home. Paul Sian shares how to give your credit score a boost.
- Getting a mortgage can be a complex process. Luke Skar explains the mortgage process from A to Z.
- Your credit profile is important. Anita Clark gives some great tips on fixing your credit.