A credit report provides prospective creditors (and in some cases
employers and insurers too) with a detailed picture of your credit
history. Your credit report can influence whether you will receive
what you are applying for.
Ideally, your credit report is accurate and up-to-date reflection.
However, since we don't live in an ideal world, there are many
reasons that your credit report could contain inaccuracies that
might prevent you from receiving the credit you deserve. The good
news is you can take action to keep your report accurate. Here
are the top five reasons why you should make a practice of regularly
reviewing your credit report:
Inaccuracies & Mixed Credit
Files
Many inaccuracies on a credit report can be the result of simple
human error, and are therefore are not difficult to dispute.
Of course, if you don't order your credit report, you might
never know about it. Whether the inaccuracies relate to payments
not credited, late payments, or data mixed in from the credit
file of someone else with a name similar to yours, you will
want to contact the credit bureau to dispute inaccurate information
promptly.
Tracking Payments
One of the most important elements of credit is a demonstrated
history of on time payments. Once you send the check though,
anything can happen--a delay in the payment being received can
kick you over to a 30-day delinquency. If you call your creditor
and explain the situation, they might adjust the information.
Of course, if you don't read your credit report, you won't necessarily
know which payments are being received and reported properly.
Identity Theft
This issue alone is reason to order your credit report immediately.
Identity theft is an insidious crime, involving a thief who
assumes your name to open new accounts, divert your card statements
to another address, and run up all sorts of bad debt without
you ever knowing about it until collectors come calling. Over
time, identity theft could jeopardize your ability to obtain
further credit. The best way to catch a thief who is using your
name is by getting a copy of your credit report, which will
show you if there are accounts listed you know you haven't opened.
For example, if a thief has intercepted a pre-approved credit
card offer in your name and sent it in with a change of address,
your credit report will include the account.
Inquiries
If you're shopping around for a loan or more credit, you should
know that when creditors check your credit, it places an inquiry
on your credit report. Inquiries can add up, which is often
interpreted as a negative by creditors. For this reason, too
many inquiries can actually make getting credit more difficult.
Moreover, if you didn't authorize someone to look at your credit
report and they did, they may have broken the law. If you would
like to see who's been looking at your credit, get a copy of
your credit report right now.
Credit Fraud--Unauthorized Charges
Credit fraud involves the theft of your credit card or account
number to make unauthorized charges to your account. Though
consumers are protected financially from this abuse, other creditors
may take note of all this activity and decide to raise your
interest rates or refuse to grant you a loan. Ordering your
credit report will help you catch new activity on accounts that
you haven't been using, or may have closed.
