Last night, I received a telephone call at home from a collection agency wanting me to pay a $92 outstanding traffic ticket from the City of Tampa, FL. I have only been in Tampa once and did not have a car. As a result I could not have received that ticket. I’m hoping that this individual just made up a telephone number and that number just happened to be mine. But it got me thinking. Why?
This week, the Federal Trade Commission (“FTC”) released a report which concluded that one out of four consumer’s credit reports contain a credit reporting error. Of these errors, it was estimated that 5% of them negatively affected the consumer’s ability to secure credit or resulted in the consumer having to pay more for credit.
Let’s put these statistics into numbers. 40 million US consumers have errors in their credit report and 10 million have either been denied credit or paid more as a result of these errors.
There are three major credit reporting agencies in the United States: TransUnion, Experian, and Equifax. These three agencies collect and then distribute your credit history and payment tendencies. A credit report is usually referenced when a bank, finance company, credit card company, automobile dealership or department store is considering extending you credit. Credit reports are reviewed in conjunction with insurance quotes and even application for employment. These data entry errors can be costing you money!
Making sure that you are not in one of these affected groups is cheap and simple. By law every consumer is annually allowed to receive three free credit reports. That’s right, FREE! All you have to do is go online to annualcreditreport.com or call 1-877-322-8228 and order your report. You can order one from TransUnion today and every four months order one from either of the other two agencies or you can order all three at once. Securing your credit report does not provide you with your credit score. If you want your credit score, you must pay for that.
Once you secure your credit reports closely examine it for errors including legal judgments, tax liens, child support delinquencies, and of course discrepancies in any credit granted or your payment history.
As an identity theft measure, make sure that the credit that has been granted has in fact been granted to you! Secondly, examine the credit report section entitled “credit inquiries” where you will see who has inquired about your credit. If you see inquiries that you have not made, you may wish to consult with a forensic professional as it is possible that someone is about to start using your credit without your authorization.
So for free and a few moments of your time you can verify that your credit report is accurate and that no one is attempting to steal your good credit.