Credit reports not only show where you stand in the field of loans and credit cards, they also show if you have been a victim of identity theft. As part of measures for preventing identity thefts, you should check out one or more credit reports regularly to make sure no one else has been using your data for personal gains. Credit report monitoring is a good method to fix your credit score and to locate identity frauds.
The FICO credit score report is based on the credit reports generated by three other credit monitoring agencies:
- EquiFax
- TransUnion and
- Experian
These companies receive data about you from different people and institutions associated with your financial transactions: credit card companies, banks and other financing institutions. The information can sometimes be incorrectly quoted by the credit reporting agencies. Due to incorrect data, the overall credit rating goes down. This needs to be fixed as soon as possible. You can get the errors fixed by writing to these credit monitoring agencies and sending them proof backing your claims.
Why Credit Report Monitoring?
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You come to know of your current credit score when you check out your credit reports generated by each of the above mentioned companies.
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If the credit score is bad, you can take steps to improve it
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You also come to know about people and institutions that have been checking your credit reports. This helps you understand who all are looking into your credit history
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Checking and balancing the credit report with actual bills can help you identity entries that may be there due to someone else taking loans or credit card on your behalf. You need to act in case of identity theft.
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The credit reports would serve as a reference sheet for your loans and other obligations. This, however, may not include all the loans you have been taking and have taken.
What to Look For?
The main items to look for, in a credit report, are incorrect ones. In other words, you have to keep on checking for the accuracy of your credit report so that your credit score stays in good standing. Among the main points to look for in a credit report from any of the above credit monitoring agencies are:
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Accuracy of personal information: Emphasis is on your phone number and address with these credit rating agencies.
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Public Records: See what all data about your legal transactions are recorded in the credit report. While data about smaller offences such as speeding etc is removed in few months, criminal cases take about five-seven years and bankruptcy filing is kept for about ten years or more. You can contest any entry that you think should be removed from your credit report.
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Loans and Credit Entries: Look and parse each entry with an eye of detail. This helps in spotting credit and loans that you know you have never taken. A regular check of loans and credits on your credit reports helps you trace identity thefts – cases where someone else has used or has been using your data for personal gains. In case you notice any such discrepancy, contact the credit rating agencies immediately. Ask them to place a fraud alert on your credit report so that lenders call you before approving any loan.
To know how a credit report looks like, check out any sample credit report available on the Internet.
