A smart consumer will get a copy of their up-to-date credit report before making any major purchase that involves financing. The reason for this is that a credit report and score can make or break your purchase and most credit reports do contain inaccuracies. The problem is that most people are unaware of the erroneous credit on their report and they end up getting an unwelcome surprise.
It has been estimated that as many as 75% of all credit reports contain serious errors. These errors can prevent the individual from getting the credit that they need. However, many of these errors and inaccuracies can be either deleted or improved with credit repair techniques.
It is true that inquiries into your credit can damage your score but whenever you get a copy of your own report it is considered a soft inquiry and it has no effect on your score. Only hard inquiries from actual creditors are counted against your score.
Even one single error showing up on your credit report can prevent you from getting the credit that you applied for. You could also be charged a higher interest rate or down payment if you do get the credit. Nowadays, credit reports are becoming even more critical as insurance companies are using them to deny coverage and some employers are even using them as a hiring tool.
The truth is that there are numerous situations in which people may request to see your credit. Utility companies, landlords, insurance companies, hospitals and doctors, not to mention the ones you typically expect such as mortgage companies, credit card issuers and other lenders. It is important to know though that it is against the law for anyone to check your credit without your explicit permission.
It is easy to check your own credit. Just contact the credit bureaus and make a request. You are allowed to get one copy of your up-to-date report from each of the three main credit reporting agencies one time per year. The credit bureaus do not exchange or share information so it is important to get all three. Also, a lender may use all three reports or just one and you never know which that will be so you need to make sure all of them are good.
Take advantage of the free yearly report and make sure to check your report on a regular basis. If there is a lot of unusual activity or you have a concern about identity theft there are credit monitoring services that will notify you of any type of change happening on your report. These services are just an additional service that can be helpful but they are not necessary.
The only person who is really concerned with what is showing up on your credit report is you. It is your responsibility to make sure that everything that is being reported is accurate and shows you in your best light. When you regularly check your report you become aware of the problems and you can take the steps that are necessary to repair your credit.
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