Credit Reports & Credit Scores – having the information you need

Did you know that you are entitled to a free credit report every year?  Your credit report contains crucial information about your financial health, including the following:

  • Your name, address, full or partial Social Security number, date of birth, and possibly employment information.
  • Existing credit. Information about credit that you have, such as your credit card accounts, mortgages, car loans, and student loans. It may also include the terms of your credit, how much you owe your creditors, and your history of making payments.
  • Public record. Information about any court judgments against you, any tax liens against your property, or whether you have filed for bankruptcy.
  • A list of companies or persons who recently requested a copy of your report.

Along with your credit report, your “credit score” is also valuable.  Your credit score, also called a FICA score, rates your credit worthiness.  This score is named after the software and analytics company that developed it.  Lenders use this score to determine how risky you are when they are deciding whether to issue a new credit card, mortgage or auto loan.  Other examples of how this score can be used are at the bank when trying to open an account, by a potential landlord when trying to rent a home, or even by potential employers when looking for a job.

Knowing your credit information and credit score can be an integral piece of your overall financial health.  You can use this report to ensure that there are no mistakes on your credit report, and importantly, that no one else is using your information to get credit, or “stealing your identity.”

Having your credit report is a necessary piece of your file when preparing for bankruptcy.  There are three main credit reporting agencies:  Experian, Equifax, and TransUnion.  Different creditors might report to just one of them, thus it is important to have a copy of all three.

The best site, in my opinion, is www.annualcreditreport.com   This is a Federally authorized site and is truly free.  There are many copycats out there that entice consumers to sign up for credit monitoring or other “credit services.”

Four years ago, after a FICA initiative, banks have had the ability to tell you your credit score.  In the past, your credit score was not free, but increasingly banks have been making this a perk of doing business with them.

Whether you are  deciding to make a large purchase on credit, or when deciding whether bankruptcy may be right  for you, you will want this important financial information.