It seems personal credit is back in the news again. Over the weekend I was reading a story in the Atlanta Journal about Credit Reporting issues that consumers were facing. Most of these stem from someone applying for credit only to find out that their credit rating had taken a hit due to someone elses information put into their file. The reason this happens is that computers are in charge of placing information on your report. Those computers scan for names, social security numbers and addresses and sometimes abbreviated names or socials that are close (within a couple of digits), can be applied to your report even though it isn't you.
To get these items removed is a chore and isn't something that can be done quickly, so you don't want to be finding out about it when trying to buy a car or refinancing your home.
As a pre-emptive measure here are some things you can do:
- You are entitled to a free credit report once per year. (or more often if denied credit). Go to www.AnnualCreditReport.com to request yours
- Note: a credit report is different from a credit score! Your credit score is generally what is pulled before issuing you credit, it is basically a numerical grade and can affect what you pay on a variety of things from insurance to loan interest rates, and is calculated from your Credit Report.
To find out your Credit Score you need to go to www.MyFico.com. This is a site operated by the Fair Issac Company, the folks that invented credit scores. You will have to pay for this one, usually about $20. While this is important to know- if you are more diligent about checking your annual credit report for free, this number should be fine and it is probably not necessary to check it that often. NOTE: the website will try and offer you a "free" score if you sign up for credit monitoring, but nothing is free and you will end up paying on a monthly basis so that may be something to watch out for.