Understanding Why it’s Important to Have Your Three in One Credit Report.
Although the FTC does not require each major reporting credit bureaus to provide consumers with a free copy of their credit report, the government encourages everyone to at least pull their credit reports each year. In fact, since many people never bother to get regular credit reports, the government has instituted this mandate in order to help consumers understand what’s on their credit reports, especially since so many different factors determine credit scores.
Under the Fair and Accurate Credit Transactions Act (or FACTA) of 2003, Americans have the right to a yearly free copy of their credit reports from the three credit bureaus that create and maintain most of them. The credit bureaus are called Equifax, Experian, and Trans Union. Each company must give consumers a free copy of their credit reports, but the scoring model for consumer credit was not always the same in all three versions of the bureaus. In magazines and books, the Solicited Report from the FTC recommends accessing these credit reports periodically by ordering them, but how do the credit bureaus prioritize their credit reports, and who ultimately has a duty to ensure that their information is accurate because each company is in business to make profits.
A recent investigation by the Government Accountability Office (GAO) found that the three bureaus often do not verify the information on their credit reports, which means that it is very easy for errors to appear and for consumers to not realize they are affected by these errors until they see their credit reports in the mail once a year.
The Fact Act also mandates that consumers can receive their credit reports and other credit information from the three credit bureaus free of charge in exchange for a toll-free call, or if consumers want their reports by mail, they must pay for the reports if they do not request them in any other way, and they must specify the provider in the Telemarketing Sales Rule. Since no company is mandated by law to supply credit report data to the three bureaus, those companies that wish to do so must inform their customers that the credit bureaus do not guarantee data. Because akin to the information compiled for the three report packages is not shared, this can be an effective way of knowing a credit report is not complete, but it is not the same thing because credit reports are not associated with credit scores.
Some consumers are concerned about the information and data included in the three free credit reports. For example, the credit reports incorrectly included a creditor’s name and address. A telephone number was included in the report when a website showed that number was a call center with such consumer’s contact information. Everything appeared accurate as the three credit bureaus reported, but not because of the one creditor or the telephone number included on the credit report, which would have produced a score.
Consumers can place a fraud alert alert with their credit report if any accounts have been opened in their name without their permission. While this does not affect an already good or great credit score, most people do not know about this option, and those that are informed find that the negative information is often ignored or removed.
