Building a Better Credit Report
Your credit report is a file about you. It is full of information on where you live, how you pay your bills and whether you have been sued, arrested or filed for bankruptcy. Creditors use this information to evaluate your applications for credit, insurance, employment or a lease. If you have a quality, credit report, it’s easier to obtai
n loans at lower interest rates which results in lower monthly payments. The only way to improve the status of your credit report is with a deliberate effort and a plan to repay your bills.
The Fair Credit Reporting Act
The Fair Credit Reporting Act (FCRA) promotes the accuracy, fairness and privacy of information in the files of the nation’s consumer reporting companies. There were recent amendments that were made to the FCRA. Those amendments expanded consumer rights and placed additional requirements on consumer reporting companies and businesses that provide information about consumers to consumer reporting companies.
You do have a right to know what is on your credit report, but you have to ask for it. The consumer reporting company must tell you everything that is on your credit report and give you a list of everyone who has requested your report within the past year or two.
There are four basic types of information that consumer reporting companies can collect and sell:
1. Identification and employment information: This includes your name, birth date, Social Security number, employer and your spouse’s name. It also
includes your employment history, home ownership, income and a previous address.
2. Payment history: This shows you how much credit has been extended and if you have paid on time. Also, it shows if a creditor has referred your account to a collection agency.
3. Inquiries: The consumer reporting companies must keep a record of all the creditors who have asked for your credit history within the last year. They must also keep a record of individuals or businesses that have asked to see your credit history for employment purposes within the last two years.
4. Public record information: This shows events that are a matter of public record, such as bankruptcies, foreclosures or tax liens.
There is no charge for you to see your credit report once a year from each of the consumer reporting companies, under the Free File Disclosure Rule of the Fair and Accurate Credit Transactions Act (FACT Act).
There are three consumer reporting companies that use one website, one toll-free number and one mailing address for you to order your free credit report. To order, go to www.annualcreditreport.com, call 1-877-322-8228 or complete the Annual Credit Report Request Form and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. You can print the request form from ftc.gov/credit. You can request only one free credit report from each consumer reporting company each year, but you should not contact the three consumer reporting companies individually.
The information you will need to provide to get your free credit report is your name, address, Social Security number and date of birth. If you have moved in the past two years, you may have to provide your previous address. To maintain the security of your file, they may ask for information that only you would know.
Neither the website nor the companies will contact you to get your personal information. If you do receive a call, an e-mail or a pop-up ad that looks like it’s from the website or one of the consumer reporting companies, it’s probably a scam and you should forward the e-mail to spam@uce.gov, the FTC’s database of deceptive spam.
You may be eligible to receive other free credit reports. If a company takes adverse action against you, such as denying you application for credit, insurance or employment, you may ask for your report within 60 days of receiving notice of the action. You may also be able to receive a free credit report if you are unemployed and plan to look for a job within 60 days, if you are on welfare or if your report is inaccurate because of fraud, including identity theft. Otherwise, the consumer reporting companies can charge you up to $9.50 for each copy of your credit report within a year.
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