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As of Thursday, December 1, 2004, one-third of Americans can now
access their credit reports from all three main credit agencies for
free. Passed in late 2003, the Fair & Accurate Credit Transactions
Act creates a central source consumers can use to obtain a free annual
credit report.
Equifax, Experian, and Transunion,the three largest credit reporting
agencies, have set up a special site where consumers can request,
view, and print their free report. That site is
http://www.annualcreditreport.com and is the only authorized site to
request your free report(s).
Those without internet access can call toll-free at 877-322-8228 or
write to Annual Credit Report Request Service, P.O. Box 105281,
Atlanta, GA 30348-5281 to request their report(s). This service,
which begins in the west coast, will eventually cover all the states
by September 2005.
Here are 4 tips to help you check your financial health with your free
credit report:
Tip #1- Check for Errors
The first thing you need to do is carefully check that your credit
report is accurate. Nearly 70% of credit reports contain errors.
These errors may be as simple as an incorrect middle initial or
address. Or it could be as serious as a creditor reporting that you
were late with a payment when in fact you were not late at all.
This error might not seem like a big deal to you. However,to a future
lender like a mortgage company, it makes a big difference!
Carefully examine your credit report and if you find an error contact
your creditor and the credit bureaus in writing. Catch and correct
these errors now before it hurts your chances of securing credit in
the future.
Tip #2 - Correcting Errors
The two most common errors contained in credit reports are:
1) wrong account information
2) incorrect recording of late payments.
If you find an account reported that does not belong you, contact the
credit grantor or issuer immediately. Remember, finding accounts that
you have not personally opened is a sign of possible identity theft.
Hopefully you'll discover that this error is nothing more than an
oversight and not an identity theft problem. Most often this occurs
when an account belonging to a family member or someone with a similar
name is reported on your credit report.
If your problem is an error in reporting a late payment you will need
proof to back up your case before this error can be corrected or
removed. The most common error occurs when a payment is reported as
"late" when it was actually a current or "on time" payment.
You will need to correct the error by contacting them in writing.
Keep a journal or log of all calls and correspondence made to your
creditors and credit bureaus.
The Fair Credit Reporting Act (FCRA) requires the credit bureaus and
the agency reporting the information to correct inaccurate information
in your credit report. Therefore, it is important that you contact
both the credit bureau and the creditor whose information is in
dispute. Again this must be done in writing to protect your consumer
rights.
You can use the sample letter in this article to help settle your
dispute. Make sure that you clearly identify the information that you
dispute, include copies of receipts or documents that support your
position. Then request that the information be corrected or deleted
from your file.
Send your letter by certified mail and request a return receipt from
the recipient. Keep copies of all correspondence that you send.
You'll have to give the agencies involved a minimum of 30 days to
begin their investigation.
Once their investigation is complete, they must notify you of the
results. Although the process will take time, it's important to do
it. This is your credit profile, your "consumer identity" that is at
stake. Don't expect an error to correct itself.
At your request, the credit bureaus must send notices of corrections
to your credit profile to anyone who has requested your report in the
last six months. If you applied for a job and were turned down
because of inaccurate information in your credit report, you can have
the corrected report mailed to anyone who received a copy of your
credit report in the past two years.
Sample Dispute Letter
Date
Your Name
Your Address
Your City, State, Zip Code
Complaint Department
Name of Credit Reporting Agency
Address
City, State, Zip Code
Dear Sir or Madam:
I am writing to dispute the following information in my file. The
items I dispute are also encircled on the attached copy of the report
I received. (Identify item(s) disputed by name of source, such as
creditors or tax court, and identify type of item, such as credit
account, judgment, etc.)
This item is (inaccurate or incomplete) because (describe what is
inaccurate or incomplete and why). I am requesting that the item be
deleted (or request another specific change) to correct the information.
Enclosed are copies of (use this sentence if applicable and describe
any enclosed documentation, such as payment records, court documents)
supporting my position. Please reinvestigate this (these) matter(s)
and (delete or correct) the disputed item(s) as soon as possible.
Sincerely,
Your name
Enclosures: (List what you are enclosing)
Originally Posted at http://www.ftc.gov/
Tip #3 - Making a major purchase
If you are considering a major purchase such as a car or a home,
checking your credit report gives you the chance to see what a
potential lender sees and uses to judge your credit worthiness.
You want to make sure that your credit report is accurate before you
apply for that sports car or new home. Errors or problems can be
corrected before your lender can use those against you and deny your
credit request. You'll also have a better idea of what type or rate
of credit you should expect from a potential lender.
Tip #4 - Check your credit report regularly
Check your credit report regularly. Guard your "consumer identity" as
you would anything else you treasure. Use your credit wisely, along
with these tips, and you will enjoy the benefits that your good credit
and your good name deserve now and for years to come.
About The Author: © 2004, James H. Dimmitt
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