Information Regarding Annual Credit Reports and Credit Monitoring


I've recently seen a few other bloggers posting about a site to get a free credit report and score. I felt it necessary to post about it because there are a lot of websites out there and while I'm not calling myself an expert, I want you to be informed about your options.

Many sites, with catchy commercials, will offer you a free credit report but while giving you your report they will also sign you up for their credit monitoring service which charges a large monthly fee. Trust me, I did this route once and ended up spending hours calling 800-numbers, getting transferred, being told I had to fax information, calling again, getting disconnected, etc trying to cancel before the free trial period was over.

There are three nationwide credit reporting companies: Experian, Equifax, and TransUnion in the United States and each company is required by law to provide you with a copy of your credit report every twelve months. The catch is that you must request it because just imagine how much money our government would spend tracking people down every year to provide them a credit report. The Federal Trade Commission (FTC) has set up the website, to allow consumers to request their copies.

You may receive one free report from each of the three companies every twelve months. While each company reports slightly differently, I don't recommend getting all three at one time. Personally, I request one report every four months from a different company. Major issues would be similar across the board so you will catch on to problems in your report before they become problems. There's nothing worse than getting ready to make a massive purchase only to be declined for credit.

Why should I request my credit report?

Because the information in your credit report is used to evaluate your applications for credit, insurance, employment, and renting a home, you should be sure the information is accurate and up-to-date. In addition, monitoring your credit is one of the best ways to spot identity theft. Check your credit report at least once a year to correct errors and detect unauthorized activity. (Source: FTC)

Now to the topic of credit monitoring. I personally don't think it is necessary to pay for, but again I would like to repeat that I am not a credit professional. Credit card companies spend millions of dollars every year on fraudulent purchases and protecting their users to prevent those fraudulent purchases. When something is going on in your account that is considered unusual, most credit cards will suspend your account. Sometimes they will notify you and other times they will not. Most likely you will find out when your perfectly fine card gets declined. A simple call to the 800-number will fix the problem and you will be ready to continue with your shopping. If you are traveling, call the bank and let them know. Otherwise your shopping might be considered suspicious if you live in New York and your card is being swiped in California.

If a credit card company calls and says something like "Hello, I'd like to speak with John Doe regarding his credit card. Can you please verify some information?" please hang up and call the actual card company back using the 800-number. Most companies won't just call you randomly and they already know things like your phone number (they called right) and account number (they keep track because they want their money) so you shouldn't have to give it to them. If they really were trying to call you, then they understand security and won't mind that you called them back to verify the legitimacy of the call before giving personal information out.

While sightly off topic of credit reports, I would like to provide a tip that I use for credit card security. Create a spreadsheet of all the cards you keep in your wallet. Don't include the account numbers, but include the company and the 800-number. If your wallet gets lost or stolen, you will have one less thing to worry about because you will have all the numbers available. When you call, companies can pull up the card numbers on their computers through your social security number and other security questions. Therefore, having the account numbers written down isn't necessary and you won't be worried about someone finding the file. Once you create the file, email it to yourself so you can access it anywhere. Companies would rather disable an account quickly and then work with you to re-open it than lose money from fraud.

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