Credit Report – Take Control Of Your Credit By Understanding Your Credit Report


Whether you are concerned about identity theft or interest rates, the first way to educate yourself for your future is by reading your own credit report.

To find information about you, many companies and individuals access a copy of your credit report and credit score to determine whether your financial history proves that you are eligible for any number of things-refinancing a mortgage, buying a new car, applying for a student loan, accepting a better-paying job-all of life's very basic situations may be profoundly affected by your credit rating.

Obtaining a copy of your credit report is the first step in gaining control over how your credit will affect your life. In the past, everyone had to pay for a copy of her or his own credit report. Recent amendments to the Fair Credit Reporting Act, the FCRA, have now made it possible for every citizen to have a copy of her or his credit report sent free of charge every twelve months. This amendment goes into full effect September 1, 2005, but may be in affect in your state even earlier.

It is important to read and understand the information in your credit report, so that you know how it can affect you, and also so that you can keep track of changes and protect yourself against identity theft and fraud. Included in your report will be any history of criminal charges, bankruptcy, financial difficulty, and employment, as well as a record of whether or not you pay your bills on time, and what kind of relationship you have with lending and credit companies.

Reading and educating yourself on the importance of your credit report in numerous situations will help you understand how to improve it. Many people who apply for a home loan or even just to move into a new apartment do not realize how bad their credit is and are surprised to find out that many lifestyle choices have been closed to them until their credit improves. Obtaining a free copy of your credit report and familiarizing yourself with the information in it at least once a year will help you learn to maintain good credit. For example, using a credit card and paying your bills on time, maintaining utility accounts in your name, and avoiding debt consolidation are all simple ways to maintain good credit.

Another reason to study your credit report is to make sure that it is complete and accurate. If you realize that someone else has obtained credit cards and piled up debt in your name, or if your credit report is inaccurate in any way, you can report the misinformation and have the errors fixed to reflect your good credit.

Familiarizing yourself with your credit report is a key step to gain control of your future now.

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