Monitoring your three
credit reports is essential to maintain a good credit standing, or to rebuild
your credit if you've experienced setbacks. At a minimum,
monitor your credit reports yearly. However, daily, monthly and quarterly
monitoring is also available. Depending on the level of monitoring you desire,
you might be able to do that yourself for free, or it might require the use of a
company.
Step 1.
Obtain a copy of one of the three credit reports through
annualcreditreport.com. Consumers are legally allowed one free copy
of Equifax, Experian and Transunion reports each year. Instead of ordering
all your reports at one time, order them spaced out at four-month intervals.
Go through each account line by line and ensure that every piece of information
listed is correct. Double-check balances and recent payment dates against
your records. Occasionally a creditor might omit updating the balance after
a payment is made, resulting in a higher utilization ratio that lowers your
credit score. Each piece of information must be correct, no matter
how insignificant it might seem.
Step 2
Monitor your reports online services available for daily alerts regarding critical
changes to your reports. FICO stands for Fair Isaac Corp. and refers to its
credit-scoring model.
Step 3
Inspect the credit
report for errors. Notify the credit bureau in writing if you notice
anything incorrect or not belonging to you. Dispute errors on your
credit report in writing. Online dispute forms can yield an automated
result; the goal is to get your
letter into the hands of a human at the credit bureau.
Step 4
Continue monitoring your credit reports
at your desired frequency. Use a calendar to remind yourself when to order
your next report.
Why Should I Monitor My Credit Score?
In today's world, having a good
credit score is imperative. Long gone are the days of being able to
slide by with c minus credit. The economy has taken its toll on everyone,
including money lenders. So their selection process for just who they will
extend a loan to, has become even more elite.
The lender needs to be certain that their loan will be paid back in full, on time.
And in order to ensure that this happens, they require a near perfect
credit score. So what exactly is your credit score? While you
are entitled to one free credit report from each of the major credit bureaus within
a 12 month period. This report does not include your actual score. You
can purchase your calculated score for an additional fee when visiting the sites
that allow you your free credit report.
What a report is exactly is a list of information shared by banks, mobile phone
providers, car loan officers etc. that have lent you money at any given time.
It lists any defaults that may have taken place, missed payments, nonpayment or
repossession. This allows future companies that you may be eliciting a loan
from to determine just how much of a liability you may be in terms of lending you
money. It is of utmost importance to
monitor your credit score closely. Keeping in mind that whether it
is purchasing your first home, or simply signing up for a cell phone contract, this
number has the power to make or break your chances of being accepted.
There have been hosts of cases where misinformation has made its way onto a person’s
credit report,
in turn negatively affecting their overall score. Had they been performing
regular checkups on the state of their financial status, these mistakes could have
been caught and adjusted before any long term damage was done. For the protection
and assurance of your current and future financial endeavors, we encourage you to
keep a close and watchful eye on just exactly what is being reported to the credit
bureaus. The actions that you take today will smooth the path for a much better
tomorrow.
The most important step is to monitor your
credit report regularly. Watch for new accounts and reports false reports
that you can dispute. Do not let a mistake impact your ability to borrow at
a low rate.