ShareThisBy NEIL DOWNING
Important news for consumers: Mark your calendar for this Friday. That's the day you become eligible, once again, to obtain a free copy of your credit report.
To place your order, use the clearinghouse that's run by the three big nationwide credit reporting companies. Here's how to contact the clearinghouse:
Phone: Call toll-free at (877) 322-8228.
Online: Use the following Web site www.annualcreditreport.com.
Mail: Use the Web site above to print out a request form, then mail the completed form to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.
(If you don't have Internet access, have a family member, friend or neighbor print out the form for you. In addition, many public libraries, colleges and universities can provide you with free Internet access.)
Why is this important? Your credit report is the official record of your personal credit history. It includes detailed, personal information, such as where you live, the credit accounts you have (mortgage loans, car loans, credit card balances and the like), and how you pay your bills.
It also includes details on whether you've been sued, arrested or filed for bankruptcy, according to the Federal Trade Commission (FTC).
Credit reporting companies sell the information in your report to lenders and others. Those outfits use the information to help decide whether to grant you credit. They may also use it to help decide what rate to charge you on a loan, how much in premiums to charge you on an insurance policy, or whether to give you a job or a promotion, said Steve Bucci, author of "Credit Repair Kit for Dummies."
Here's another reason to get a copy of your credit report: "It's very often the first warning that people have that something's amiss with their credit," said Bucci, president of the MMI Financial Education Foundation, which is affiliated with Consumer Credit Counseling Service of Southern New England.
So this is a good time to check your credit report for accuracy.
Why now? Starting Sept. 1, 2005, the three big credit reporting companies had to provide a free credit report to consumers in all the New England states, and certain other locations.
Technically, federal law required each of the three _ Equifax, Experian and TransUnion _ to provide you with a free copy of your credit report once every 12 months.
So if you made the request to each of the companies when you first became eligible _ on Sept. 1, 2005 _ this Friday is your next opportunity to obtain another free copy of your credit report from each of those companies.
What should you look for when you receive your copy? Here are two key things:
Errors: On average, "One in four consumers will have something on their credit report that doesn't belong there," Bucci said.
If left uncorrected, errors could prompt a lender to charge you a higher interest rate, an insurer to levy higher premiums or a prospective employer to reject your job application, Bucci said.
The information you receive along with your credit report will include a form with instructions on how to get erroneous items fixed. Fill out the form and send it in; the credit reporting company will then respond, he said.
Identity theft: In general, identity theft occurs when someone uses your personal information _ such as your name, Social Security number or credit card number _ to commit fraud, the FTC says.
Identity thieves may use the information to open one or more credit accounts in your name. When they fail to pay for charges, the delinquency shows up on your credit report, which could make it harder for you to obtain credit or qualify for credit on favorable terms.
So check your credit report for any suspicious entries, such as accounts that have been opened in your name without your knowledge.
The information you receive in the mail will include a special ID fraud number to call to have the credit reporting companies place a "fraud alert" in your file.
That lets prospective creditors and others know that you may be a victim of identity theft. (A fraud alert tells creditors to follow certain procedures to protect you, making it more difficult for someone to get credit in your name.)
To learn more about the FTC's nationwide campaign on identity theft, call the agency's identity theft hotline toll-free at (877) 438-4338, or use this Web site: www.consumer.gov/idtheft.
A few other points: Instead of ordering all three credit reports at once, consider staggering your requests. For example, on Friday, you might order a free copy from the first credit reporting company on your list. Four months later, order a free copy from the second company on your list. Four months after that, order a free copy from the third company. That way, you get to check your credit report a few times throughout the year, instead of checking all three reports at the same time just once a year.
If you plan to order your free credit reports online, make sure you use the address listed at the top of today's MoneyLine, so that you're not linked to imposters. Or simply use the FTC Web site www.ftc.gov. On the left side of the screen, click on the "credit report" link.
You may not have to wait to obtain a free credit report based on the rules described above. For example, you're entitled to a free report if a company takes adverse action against you _ such as denying your application for credit, insurance or employment _ and you ask for your report within 60 days of receiving notice of the action.
To learn more about this subject, use this FTC Web site www.ftc.gov/credit.
(Neil Downing is author of "The New IRAs and How to Make Them Work for You." E-mail moneyline(at)projo.com.)
