Checking Your Credit Record
Every time that you apply for a credit card, loan, or other type of credit you probably have a stranger checking your credit record. Doesn’t it make sense for you to check your credit report as well?
If your credit record shows that you don’t pay bills on time or have a lot of debt, this will have an effect not only on whether you get the credit, but on the interest rate that you are offered. It is important for you to know what your credit record is and to verify its accuracy.
Your credit report includes information about how you pay your bills, what your monthly debts are, how much credit you have available, and whether you repay loans, along with other credit, public record, and identifying information. This helps potential lenders decide what kind of credit risk you are. The report itself does not state that you have good credit or bad credit. It does, however, provide lenders with private information about you to help them make that decision.
Because the information in your credit report is so personal and so important, the Fair Credit Reporting Act (FCRA) is a law which states who can access your report and why. Your credit report can be viewed only by people like lenders, landlords, credit card companies or others that you conduct or may conduct business with. Anyone who requests your credit report must have a "permissible reason" to view the report. Some potential employers ask for written permission to view your report, but they generally receive a modified report.
You should check your credit report personally at least once a year. You are legally entitled to a free copy of your credit report every 12 months from each agency. The three major companies are Equifax, Experian and TransUnion. You can request your free credit report from their websites or toll-free telephone numbers. There is also a website, www.annualcreditreport.com, set up by these three credit reporting agencies allowing you to order all three free annual credit reports in one place. Checking your credit record more regularly than once a year is also a good idea. You can request a copy of your report more frequently for only $10.
It is important to realize that you have rights when it comes to how your credit history is kept and used. There are rules that the credit agencies must abide by legally. These rules cover:
Report access - Only those who have a "permissible purpose" can see your report.
Written consent – Your consent is required in writing for any reports given to employers or potential employers. Your written consent is also required for any medical information to be reported to anyone.
Personal access - You have the right to a copy of your report as well as a list of everyone who has accessed it at any time. The maximum charge for this report is $10, but you are entitled to a free copy once yearly.
Credit denial - If you are denied credit, employment, or any other service or product you were seeking as a result of something in your credit report, the person who denies you is required to tell you why. They must also tell you how to contact the credit bureau that provided the information that they based their decision on.
Inaccuracy disputes - If you check your report and find information that is inaccurate, then you may dispute the information and the CRA must reinvestigate it within 30 days. Until it can be proven to be accurate, they are not allowed to put the disputed information on your report unless they include your written dispute statement. If you can prove the inaccuracy of the information, it has to be removed permanently from the report within 30 days. It is the responsibility of the agency you are dealing with to then inform all other national credit reporting agencies of the inaccuracy.
Outdated information - In most cases, negative information can only stay on your report for seven years. Bankruptcy information is an exception that stays on for 10 years.
Removing your name from marketing lists - You may have your name removed from any lists that credit reporting agencies sell to marketers.
Seek damages – You can actually sue for damages if someone accesses your credit report without "permissible purpose" or your written permission. You may also sue for damages if any other specification of the FCRA is violated.
Check your credit report each year carefully for mistakes, inaccuracies, or missing information. Your credit history will stay with you for many years and affects many of your financial options and decisions. It is worthwhile for you to make sure that your history is something that you won’t mind people reading for years to come