I know it can be a hassle to deal with credit reporting agencies. But you HAVE to keep track of your credit! Once every 6 months is a good stand by for checking your credit. The easiest way to do it is to go to Annual Credit Report dot com. This is the ONLY Free and government sponsored way to get your annual credit report for free. You can get one from each of the three credit reporting agencies: TransUnion, Equifax, and Experian. In essence, you could check your report 3 times a year for free if you wanted to. Using AnnualCreditReport.com, you don't have to sign up to a monthly service or any of that. It's super easy and of course free. So go get yours right now!
Okay, you've got your credit report, now what does it all mean? Basically, you want zero negative items and a whole lot of positive items on your credit report. Typically, if you have something in collections, like an unpaid speeding ticket (ahem, me) or an unpaid bill, that reflects negatively on your credit reputation and banks and credit companies will be less likely to give you a loan, open a line of credit, like a credit card, or do business with you at all because of this. Many banks have a "No Collections" rule which states that if an individual has ANYTHING in collections, credit is denied.
I'll talk more about different factors of a credit report in later posts. All you need to know for now is that a credit report gives you an overview of your credit history and you can use it to contest negative items, scan for identity theft, etc. One thing it doesn't give you however is your Credit Score. Everyone talks about that, so what is it?
Your credit score is an algorithm used by the credit agencies to represent your credit report in a single number. Every credit agency uses a different formula and might have different data going into that formula so your three scores might not be the same number. Credit Agencies are not required to give you a credit score for free, but there is at least one way around that.
Experian gives you a free credit score as long as you sign up with their service. There is a free 7 day trial period. It can be a huge hassle to cancel the trial though. Having done it myself, here's the quick way. To get the free score:
- go to www.freecreditscore.com
- sign up and give them your credit card information to sign up for their free service.
- Check out all the stats on yourself along with the credit score.
- Log it, print it, track it, record it somehow.
- Now let's immediately cancel it, you can do this within the same day or even hour if you want to. It's really difficult to get a hold of them, but I was able to find the cancellation number finally which is: 866-673-0140
- call that number and say no to all the stuff they offer you, just keep saying all I want to do is cancel my service. Make sure they are not charging you for anything, and then you're good to go. Takes anywhere from 5 to 10 minutes.
And that's it. I'll have more tips and tricks on credit reports and scores in later posts!