Your Credit Report Needs a Careful Eye

Make sure your credit report is accurate, complete, and up-to-date.

Federal Trade Commission

Your credit report is a powerful source of information about how you pay bills and whether you have been sued, arrested, or filed for bankruptcy. Consumer reporting companies sell the information in your report to creditors, insurers, employers, and other businesses that use it to evaluate your applications for credit, insurance, employment, and renting a home. Make sure your report is accurate, complete, and up-to-date!

Here's why you should review your credit report periodically:

• You need to make sure the report is accurate before you apply for a loan for a major purchase such as a house or car, buy insurance, or apply for a job.
• The report contains information that affects whether you can get a loan — and how much interest that you will have to pay to borrow money.
• To help guard against identity theft, you need to check the report to see if someone opened a credit account in your name.

The federal Fair Credit Reporting Act (FCRA) promotes the accuracy and privacy of information in the files of the nation's consumer reporting companies.

An amendment to FCRA requires each of the nationwide consumer reporting companies — Equifax, Experian, and TransUnion — to provide you with a free copy of your credit report, at your request, once every 12 months. For details, see Access Your Free Credit Report atwww.ftc.gov/bcp/conline/edcams/credit/.

Correcting Errors

Under the FCRA, both the consumer reporting company and the information provider (that is, the person, company, or organization that provides information about you to a consumer reporting company) are responsible for correcting inaccurate or incomplete information in your report.

To take advantage of all of your rights under this law, contact the consumer reporting company and the information provider.

Adding Accounts to Your File

Your credit file may not reflect all your credit accounts. Although national department store and all-purpose bank credit card accounts will be included in your file, not all creditors supply information to consumer reporting companies: some travel, entertainment, gasoline card companies, local retailers, and credit unions are among the creditors that don't.

If you've been told that you were denied credit because of an “insufficient credit file” or “no credit file” and you have accounts with creditors that don't appear in your credit file, ask the consumer reporting companies to add this information to future reports. Although they are not required to do so, many consumer reporting companies will add verifiable accounts for a fee. However, understand that if these other creditors do not report to the consumer reporting company on a regular basis, the added items will not be updated in your file.

Only the Passage of Time Can Assure Removal of Negative Information

When negative information in your report is accurate, only the passage of time can assure its removal. A consumer reporting company can report most accurate negative information for seven years and bankruptcy information for 10 years. Information about an unpaid judgment against you can be reported for seven years or until the statute of limitations runs out, whichever is longer.

No Time Limit

There is no time limit on reporting: information about criminal convictions; information reported in response to your application for a job that pays more than $75,000 a year; and information reported because you've applied for more than $150,000 worth of credit or life insurance. There is a standard method for calculating the seven-year reporting period. Generally, the period runs from the date that the event took place.

This article, and hundreds more, can be found on the NEA Member Benefits web site in the “Member Library” section: http://www.neamb.com/consumer_articles.jsp