|

Credit-report errors can cost you plenty

Here's how to check your reports to prevent problems

Consumer Reports Money Adviser: June 2013

Five percent of consumers who checked their three major credit reports found errors that were serious enough to affect their credit scores, according to a recent Federal Trade Commission study. As a result they could be paying more for such products as home mortgages, auto loans, and insurance than they should, or they might be denied credit altogether.

The study, which was mandated by Congress, involved about 1,000 participants. It shows why checking your reports and disputing any errors you find is critical. More than one in 10 consumers saw an improvement in their credit score after they disputed mistakes and the credit bureaus modified their reports.

What to do. The Consumer Financial Protection Bureau reports that only about one in five people check their credit reports annually. Don’t be one of them. Examine your reports from all three major credit reporting agencies—Experian, Equifax, and TransUnion—at annualcreditreport.com. You’re entitled to one free copy of each report every 12 months. To monitor your information all year long, get a free report from one of the three credit reporting agencies every four months.

Some lenders and insurers use reports from other specialty credit bureaus. Some of them must give you one free report annually if you request it, while others can charge a fee unless their report resulted in an adverse action against you.

To identify and obtain specialty credit reports, check this list of about 40 specialty bureaus (PDF) created by the CFPB. Check your reports from these bureaus when there’s a specific reason to—for example, when you’re applying for insurance.

   

E-mail Newsletters

FREE e-mail Newsletters!
Choose from cars, safety, health, and more!
Already signed-up?
Manage your newsletters here too.

Latest From Consumer Reports

Mattresses
MATTRESS REVIEWS
Find the mattress you want at the price you wantVideo You'll find deals this weekend, but big sales aren’t limited to holidays.
CELL PHONE CARRIER REVIEWS
Choose the right cell phone plan for you and your family We compare plans from AT&T, Sprint, T-Mobile, and Verizon.
NEW CAR REVIEWS
Best deals on American-made cars for July 4th You'll find a wide range of incentives at dealerships over the holiday.
Home remodeling
KITCHEN DESIGN & PLANNING GUIDE
Home remodeling: Kitchen renovation on a budget Learn how to get exactly what you want without breaking the bank.
Money
CARS NEWS
You can save big bucks on car rentals this summerVideo Rental companies frequently fail to mention mandatory extra fees.
WASHING MACHINE REVIEWS
Clean machines: Matching washers and dryers These smart-looking pairs cleaned up in our tough lab tests.

Connect

and safety with
subscribers and fans

Follow us on:

Cars

Cars Build & Buy Car Buying Service
Save thousands off MSRP with upfront dealer pricing information and a transparent car buying experience.

See your savings

Mobile

Mobile Get Ratings on the go and compare
while you shop

Learn more