When we talked about credit report, you said I should review it periodically. But why do I need to review my credit report?
You need to review your credit report because any incorrect information on your credit report can negatively impact your loan applications, like a mortgage, and credit card applications. Also, reviewing your credit report helps you catch signs of identity theft early on.
What should I look for when I review my credit report?
Check for identity related errors, like wrong name or phone number, or presence of accounts belonging to someone else with a name similar to yours. Also check for presence of any accounts that have not been opened by you, or any financial activity unfamiliar to you – these could be signs of identity theft.
You should also check for any closed accounts reported as open, incorrect account balances, incorrect dates of payments, incorrect credit limits, etc.
How often should I review my credit report?
You should check and review your credit report at least once every year. If you are planning to apply for a large loan, like a mortgage or car loan, you should review your credit report 3-6 months in advance so that you can fix any incorrect information.
If I find any incorrect information on my credit report, what should I do?
You can get it corrected by raising a dispute with the credit bureau – the credit report usually has information on how to do this. You can also contact the creditor that reported this information, and request them to send an update to the credit bureau.
Do I need to do something if the information on credit reports from different credit bureaus is different?
No. Lenders do not need to report to credit bureaus at all – and if they do, they can choose which credit bureaus to report to; so it is acceptable to have slightly different information on your credit reports from Equifax, Experian, and TransUnion.