Tips To Maintain An Accurate Credit Report

So many people are applying for mortgages and using credit cards for all of their purchases these days it's essential to maintain a good credit file. Therefore, it is also important to know how to obtain your credit report and clean it up if there are any errors.

It is vital to check your credit file periodically, and more importantly understand what it tells you. There are three main credit reporting agencies: Equifax, Trans Union, and Experian. Each company uses a different method for calculating credit scores and each report is often slightly different. Included in your credit report is your full name, current and previous addresses, social security number, all open and active accounts, recently closed accounts, and hard and soft requests to view your report.

By law, you are entitled to check your credit report from each of these reporting agencies once per year. That means if you time things correctly and only check one agency at a time, you could essentially check your file every four months for free. Now, if you are applying for a large loan then it might be wise to go ahead and check all three reports for accuracy.

In addition to a free credit report each of the three main reporting agencies also provides paid services. These allow you to see your report more in depth. A paid report also explains what is affecting your credit score, both positively and negatively. A paid report is nice because they carefully explain each section of the report and is more in depth.

Trying to get a mortgage? For many of us obtaining a mortgage is a big deal; Not only are we embarking on a new chapter in life and purchasing a new home, but our past chapters that might not have been so bright can come back and haunt us. Past credit problems stay on your credit file for seven years! That's not all, things like bankruptcy and criminal convictions are also put on your report. Make sure to check for information that could put a red flag on your file and cause you not to get a mortgage before you apply.

Inaccurate information, on the other hand, is possible to fix. If, after glancing over your free report, you notice some inaccuracies on your file you must alert the reporting agency immediately. If you feel there is fraudulent activity on your account, the agency will put a fraud alert on your file. This is not a red flag to loan agencies; it just lets banks know that there has been suspicious activity. When applying for a new loan, or credit card, or bank account, you will often need more proof of who you are (this is a good thing, we don't need imposters further scarring our report!) Reporting agencies will also investigate any of the inaccuracies you point out to them. In addition it is a good idea to contact the bank who is reporting the error and clear it up with them. Most often errors cleared with a bank are then changed on your credit file within a few weeks.

It is best to file a complaint in writing with proof of ID and any documents supporting your claim. Each reporting agency has information on their website about what to submit and where to send your inquiry. It is also possible to notify Equifax, Trans Union, or Experian via the phone or even online. I recently noticed some small errors on my reports, so I filed a form online to notify them of the mistake. It usually takes quite a few weeks to complete an investigation.

Staying on top of your credit file is made even easier for us by online credit reporting agencies providing annual free reports. It is a good idea to take advantage of this offer and ensure your credit information is correct and up-to-date. This way, you can make necessary changes before applying for a loan.