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How to Review Your Credit Report
Posted By Ron On April 7, 2011 @ 1:00 AM In Credit,Personal Finance | Comments Disabled
Back several years ago, my wife and I both requested copies of our credit reports (get yours at www.annualcreditreport.com ). Mine was correct. Hers was not. She and her older brother have the same initials, lived at the same addresses, and obviously have many other data points in common. It wasn’t difficult to get these errors corrected, but it did take some time. Thankfully, I had been employed in a financial services firm and had experience reading the mish-mash of data that’s on a credit report.
How many credit reports contain errors? Estimates range from 25 percent to 75 percent and, though most errors are of no real consequence, there are a few than can hurt your credit score  and by default, hurt you in a multitude of ways financially.
Your credit report is simply the raw data of who you are, where you’ve lived and worked, where else you’ve applied for credit, and how well you’ve paid your creditors – data that is unedited and unfiltered. Your credit score  is that raw data compiled and examined. It’s the explanation of your credit report to people who don’t have time to examine the nitty-gritty details. Both credit scores and credit reports are important to review, so don’t neglect reviewing either.
Credit report errors can cause your applications for credit, employment car insurance , or housing to be delayed or even denied unexpectedly (and unfairly). Order and review all three of your credit reports and all three of your credit scores at least six months in advance of applying for any major loan. This will allow you enough time to dispute any errors that you might find. It will also give you time to prepare an explanation for any remaining inaccuracies to a potential creditor.
Your credit report can help you anticipate how creditors will view you as a potential borrower, renter, insurance risk, or even employee. Once you’ve identified any weaknesses in your credit report, you can work to resolve them and improve your appeal in the eyes of creditors.
Most people don’t know they’ve been a victim of identity theft for months or even years after their identity is initially stolen. The sooner you recognize and address identity theft, the less damage will be done to your credit and your finances.
The credit reporting industry collects and assembles billions of pieces of credit history information every month. Just the sheer volume of information guarantees that errors and outdated information occasionally show up. Be sure to look over every part of your credit report carefully and mark down any errors you find. If you find an error in a report from one credit bureau, make sure to check the others for the same error, since you’ll have to correct each error in each report. In particular, look for the following:
These are HUGE, damaging, entries to anyone’s credit report. Avoid them if you possibly can.
In some cases, a mistake on your credit reports may not be the result of simple human error but is actually a giant red flag for identity theft. The most common credit report errors stemming from identity theft are:
If you think you may be a victim of identity theft, you must act immediately to protect your finances and your credit.
The credit bureaus are required by law  to investigate and correct inaccurate or incomplete information in your credit report  once they have been notified of the errors (generally 30 days or less). For the record, accurate information CANNOT be removed except by the passage of time or the benevolence of the creditor. Anyone who convinces you otherwise is simply after your money. Attempting to remove accurate information could be considered fraud and could be prosecuted. Inaccurate information CAN be removed and the credit bureaus will willingly remove it once the inaccuracy is substantiated.
Follow these three steps to make sure the credit bureaus resolve any problems with incorrect information in your report:
But it’s a necessary part of making certain your financial reputation is kept accurate and intact.
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