Credit Reports: Just the Facts

Fall has arrived-time to set back the clocks, get a flu shot, and check your credit report? Wait a minute. Check your credit report?

It’s important to set an annual routine – credit reports contain information about late payments, amount of total debt, number of credit cards, and other facts that can affect the loan interest rates, terms, and fees that you pay. Incorrect information can occasionally appear in any individual’s credit report and the sooner you correct errors, the less harm they can do to any loan applications or loan interest rates.

You can check the accuracy of your credit reports for free once every year with each of the three private firms that prepare the reports-Equifax, Experian, and TransUnion.

The information in credit reports can play a role in whether you are offered a job or eligible for a loan. A Federal Trade Commission study found that about 5 percent of credit reports have errors that are big enough to trigger higher interest rates for loans http://www.ftc.gov/os/2013/02/130211factareport.pdf

Still, only about 16 million free reports are ordered each year out of more than 200 million people in the United States with credit records. In Wisconsin, around 39 percent of adults reported obtaining a copy of their credit report in one recent year, compared to 42 percent nationally, according to a 2009 FINRA Financial Capability Study http://www.usfinancialcapability.org

There is only one legitimate source for a free credit report (www.annualcreditreport.com or phone 877-322-8228 toll-free).

These contacts were created by the three nationwide consumer credit reporting firms and are the only no-cost contacts for your free credit reports.

Other websites claim to offer free reports, but they often charge significant fees. Similarly, responding to unsolicited e-mails, pop-ups, or phone calls offering reports may lead to unwanted fees.

Final note: if the unlikely happens and you are unable to resolve a dispute with a credit bureau over wrong information in your file, you can submit a complaint online to the U.S. Consumer Financial Protection Bureau at www.consumerfinance.gov/complaint.

Resource for this article: Community Bankers of Wisconsin

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