It is vital to check your credit report for errors at least once a year. Having an inaccurate credit report can cost you hundreds or thousands of dollars in the long run, as it affects your borrowing capacity, your rates on loans and other services, and your ability to rent or buy a home.
Checking your credit report every year is not only easy, but it can help you prevent identity theft and save money. This article will outline six key steps on how to check your credit report for errors.
Step 1: Obtain a Copy of Your Credit Report
The first step in checking your credit report for errors is to obtain a copy. You are legally entitled to a free copy from each of the three main credit bureaus (Equifax, Experian, and TransUnion) once every 12 months. You can get them directly from the credit bureaus, or you can use a free service such as www.annualcreditreport.com.
Step 2: Review Your Personal Information
The second step is to review your personal information on the credit report, such as your name, address, and Social Security number. Make sure that all the information is accurate. Check your past and current addresses to see if they are up-to-date. In addition, check to make sure all of your open accounts and previous collections are listed.
Step 3: Check Your Credit Inquiries
The third step is to check your credit inquiries. Every time you apply for credit, the lender will make a “hard inquiry” on your credit, which can lower your score. Go through your credit report and check for unauthorized inquiries. If you find any, contact the credit bureau and request to have them removed.
Step 4: Review Your Account Histories
The fourth step is to review your account histories. Check each of your accounts to see if they accurately reflect the payments you have made. The report should list all missed and late payments, as well as any balance increases or decreases. Make sure that all the details are correct.
Step 5: Consider Your Credit Scores
The fifth step is to consider your credit scores. Your credit score is based on the information in your credit report. Make sure that your scores are accurate and up-to-date. Also, look out for any discrepancies between the scores that different bureaus provide.
Step 6: Report Discrepancies
The final step is to report any discrepancies. If you find any errors on your credit report, contact the credit bureau and dispute them. You can dispute errors on your credit report online or by mail. The credit bureau will investigate the dispute and, if it’s determined to be valid, the incorrect information will be removed from your report.
Final Thoughts
Checking your credit report for errors is an important part of managing your financial health. By following these six steps—obtaining a copy of your credit report, reviewing your personal information, checking your credit inquiries, reviewing your account histories, considering your credit scores, and reporting discrepancies—you can ensure that your credit report is accurate and up-to-date. Doing so can help you save money and avoid costly errors.
