In the last post I talked about my transfer across the country and how I was feeling my way around an area that was completely new to me. After several months in a rental – and feeling better about the town and my likelihood of staying with my company – I decided to begin looking for a house to buy. Once I found it and everything was put into motion I was completely dumbstruck to be informed that I was unlikely to receive mortgage approval because of my credit report. This was news to me. I had always thought my credit report was fine and was under the impression that everything was okay because I had received a pre-approval from the mortgage company.
I was sent into a whirlwind that left me emotionally drained. In the end we were able to address the items on my credit report and find another lender that would eventually approve me for a mortgage. Thankfully because it is a buyer’s market and there wasn’t a lot of competition on the horizon, the sellers were willing to wait for me and thanks to them I was still able to get into the home that I loved.
But boy did I learn a lesson! Never again would I be caught off guard by something so monumentally important. The issues on my credit report were two unpaid bills that I didn’t even know existed, let alone know how much they were impacting my credit score. Had I been receiving free credit reports on a regular basis I would have been alerted to the existence of these bills and could have taken care of them before being surprised during the mortgage process; a mistake I will never repeat. Starting right when I closed on the house I ordered free credit reports and will continue to do so each and every year so that I am well aware of what is going on my credit report before anyone else becomes aware first.
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No one likes surprises that do not have presents and cake at the end. And getting caught off guard by your own finances would never be considered a good surprise. In fact, it can feel like the rug is being pulled out from under you. That’s exactly what happened to me six months ago when I was in the middle of what I thought would be a seamless mortgage transaction.
I had been transferred across the country for a job and found myself in a place that was unfamiliar in all senses of the word. After renting for a couple of months I knew that it was time to start looking around for something more permanent especially if I was going to stay with the company - as this transfer was most definitely not a temporary situation. More importantly, I knew that if I wanted to buy a home this was the time to do it as I had nothing to sell and it was a buyer’s market. The real estate agent with whom I worked showed me many properties over the course of several weeks but eventually I found the one that spoke to me and I was more excited than ever to take this step in my life.
I had been pre-approved for a mortgage amount with which I was comfortable and after the sellers accepted my offer the mortgage went into underwriting. That was the last of the smooth sailing.
Within a matter of days I was notified that it was unlikely that I was going to be approved for the mortgage due to some issues on my credit report. I was completely devastated and seriously confused. I knew of no such issues and I felt completely blindsided. I had no idea what to do next. Was I going to lose my house? More to come…
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I am a person who works best with a schedule in hand. I have lists for everything – from what has to be done to who needs to be called; without which I would be in big trouble. I also keep careful schedules of what has to be done around my house from season to season. For instance, we stick to the schedule of changing the batteries in the smoke detectors, as well as testing all smoke and carbon monoxide detectors, when we change the clocks. I know what needs to be done month to month to ensure that my home is run in the most efficient manner possible.
Finances are also a big thing to keep track of; in addition to the everyday tracking of expenses and budget there is the overall consideration of the bigger picture. Part of what we do every year is to order free credit reports from the credit bureaus so that we are always up to date about what is being reported on our credit report and how that may affect our credit score and subsequent borrowing power. It is so important to order free credit reports from each of the three credit bureaus and because you are allowed by law to order one credit report from each of the bureaus within very twelve month period I have set up a schedule that works for us.
I order one free credit report from one credit bureau every four months. This ensures that I have a quarterly stream of free credit reports coming from at least one of the credit bureaus and that I can stay on top of changes on my credit report or a drop in my credit score that may indicate a problem.
By scheduling the ordering of my free credit reports I have the peace of mind that I am being proactive in terms of my finances – just as I am proactive and organized in every other regard.
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In the last post we talked about the rising prices of so many things and how we are paying for things that may seem to us that they should be ours at no cost. The availability of online shopping has opened up so many doors for us but has also confused the issues when it comes to knowing who to trust and where to go and if we are paying for something that we can get elsewhere at no charge.
Credit reports, for example, are advertised all over the web offering us the opportunity get copies for a particular price. But, as we discussed earlier, knowing the facts allows us to find what we need with ease. We already learned that we have three credit reports – not just one – each created by one of the three credit bureaus. The information – while largely similar – can absolutely deviate from one credit report to the next so it is important to look at all three.
Another fact is that we are each entitled to receive one free credit report within every twelve month period from each of the credit bureaus. This means we are within our right to request this information and it will be given to us at no charge. Period. Many people rotate the credit bureaus from which they request their credit report so that they receive a free quarterly credit report throughout the year.
Additionally, it is important to know where to look. Each of the credit bureaus has their own contact information of course. But in order to request free credit reports online consumers just have to visit www.annualcreditreport.com where they can order from any and all of the credit bureaus.
Know what is worth the charge and what is due to you for free. When it comes to free credit reports they should be just that – free.
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Prices on nearly everything just keep rising and it seems like every time we turn around there’s another charge for something; even things that intuitively feel as though they should be rightfully ours. Our credit report, for example, is what defines us financially in the world of lending. It is our personal financial profile that lenders use to size us up and determine whether or not they will extend us a loan or line of credit, or that landlords use to determine if they will indeed rent us that apartment. Our credit report matters; and it has everything to do with us on a personal level. Yet, there are many companies out there that charge fees for consumers to order their credit reports when in fact it is allowable by law for each of us to get one free credit report per year from each of the three credit bureaus.
This is something to pay close attention to especially since we are met with thousands of messages a day online where it can easily get confusing as to who is offering what and at what price. So here are the facts…
We don’t just have one credit report we have three because there are three credit bureaus that are responsible for collecting all of the financial criteria that will be used to create such reports. The three credit bureaus are Experian, Equifax, and TransUnion. Each credit report produced by each credit bureau is uniquely its own. You will find that there is some information that is the same across the board and some information that differs from credit bureau to credit bureau which is why it is so important to always check your credit report through all three bureaus.
More facts about your credit report and ordering free credit reports in the next post…
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Credit cards can mean bad things for some people. While they are best used for emergencies or for monthly expenditures that are then paid in full when the bill arrives, more often than not they become a source of income for many households that are struggling to make ends meet on what they bring home in terms of salary. It may seem as though using that credit card will get you by and ease your cash flow but in the end it does just the opposite as the payment rises and becomes more difficult to make. More than anything, the interest that we pay on credit card payments is what will ultimately determine how much we are paying – or overpaying – month to month.
Getting out from under credit card debt can be difficult work. If it was easy everyone would do it. Instead, there are many of us drowning in the debt that we owe and wondering how we will make the payments on a credit card that has long been maxed out. There are many ways in which people will go about the work of getting out of debt and debt consolidation through a personal loan or home equity loan are among them. But if those are not options – especially in this economy when loan approvals are hard to come by – then it still certainly make a huge difference to compare credit cards, find a card that has a much lower interest rate, and transfer all of your credit card debt to that card. Some credit cards even offer zero percent interest rate for the first year of having the card – which can have a significant impact on the payments you can make towards paying down and eventually paying off your debt.
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In the last post we began talking about the benefits of free credit reports. There are a great number of people who don’t know anything about free credit reports and how they can benefit their financial standing. Some of the benefits that we discussed included the ability to have your financial information in your hands so that you always know where you stand and are not caught off guard when you go to apply for a loan, a lease, or even a job. Further, ordering free credit reports will allow you to stay in control so that you are able to notice changes when and if they occur; a huge advantage in helping to safeguard yourself against identity theft. Additionally, free credit reports allow you to have a way to measure your progress should you decide to take steps to improve your credit. Your hard work will be reflected in your credit report which will give you the firsthand information you need to continue.
Even with all of these benefits people still do not order free credit reports as often as they should, if at all. And so now we will tackle some of the common things that people may not know about free credit reports including:
• Our credit report is not just one report but three. There are three credit bureaus that hold our financial information and each one compiles a credit report which may differ slightly from the rest.
• Free credit reports can be easily ordered online in a matter of minutes through a central website that gives consumers access to each of the three of the credit bureaus.
• Free credit reports can be ordered from each of the credit bureaus once within every twelve month period. We are entitled to these reports at no charge.
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We have all been introduced to free credit reports simply by way of the many singing commercials continually gracing our televisions. And for many of us that may be our only source of information regarding what can ultimately be very important components in our financial health. Aside from the commercial attention, aside from the human inability of most of us to want to face our financial truth, there are very important benefits of free credit reports that should be considered.
The benefits of free credit reports include:
• Information. You are your best advocate when it comes to your finances. If you are not informed as to the current status of your credit report then you can hardly feel put out if you are surprised when information is brought to light during a credit check for a loan application. You need to know what you are dealing with before you put your information in the hands of potential creditors; you should never be surprised by the information they have managed to obtain. Free credit reports allow you to have all of the information.
• Theft identification. The reason that identity theft is nearly always successful is because by the time anyone notices that something is amiss the thief is long gone. Free credit reports won’t stop the threat of identity theft but it will tip you off quickly when something is wrong; that extra time can mean a lot in the end.
• Way to measure. A credit report can easily go wrong when there are poor financial decisions that are made. Good credit can open a variety of financial doors; conversely poor credit can close those doors smartly in our faces. We need to take steps to improve our credit report if that is necessary and free credit reports help us to measure our progress.
More to come in the next post…
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We all need some encouragement sometimes and when it comes to our finances there is no better cheerleader than our credit report. That may seem counterintuitive to most people as their credit report is something that they simultaneously fear and dread. But with some changes in perception and some proactive behavior the credit report can actually be used as a tool for positive accomplishments. Here’s how:
• They show you where you’re starting. First and foremost your credit report – of which there are three supplied by the three credit bureaus, Experian, Equifax, and TransUnion – will give you the most important tool that you need to get started – information. You can’t make any progress until you know from where you are starting and your credit reports can tell you that immediately. Order free credit reports online from each of the credit bureaus and you will instantly have a place to start.
• They tell you were to go. By looking at your free credit reports you’ll be able to determine your course of action. What do you want to accomplish? Do you want to raise your credit score? Remove erroneous information from your credit report? Take steps to begin improving your overall credit report? Free credit reports not only give you your starting place they allow you to begin mapping out your journey so that you can achieve success.
• They show you what you’ve accomplished. This is the big one. Making financial changes are not easy. But when you start to see the rewards on your improved credit report you will get all the encouragement that you need to continue moving forward. In the end, your own credit report may be the best cheerleader that you have in helping you stay on course financially and find your way to a much better place.
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In the last post we talked about the importance of having all the facts when it comes to your credit report. Dealing in unknowns gets you nowhere when it comes to making any sort of financial headway; you are only left wondering, supposing, and ultimately making up your own stories - none of which may be true. In order to make real change and gain the financial control that will reap ongoing benefits you need to have the facts and figures right in front of you. Free credit reports will put information in your hands but we must take them time to order them – which far too few of us do even though it is easy and virtually painless.
As we began talking about, there are actually three credit reports on our behalf – not just one – because there are three separate credit bureaus that compile this information. In order to have the clearest financial picture we must be able to look at all three of these credit reports and so they must be ordered from each of the three credit bureaus –Experian, Equifax, and TransUnion. Once upon a time this required the writing of a letter and the sending of that letter via mail. Today, the Internet allows us to order free credit reports from all three of the credit bureaus in a matter of moments.
It should also be noted that free credit reports are something that we are entitled to once a year; after that, in order to receive a copy of our credit report, we have to pay a small fee. In order to make the most of your ability to get a free credit report try ordering one credit report from each of the three credit bureaus every three months – thus allowing you access to pertinent – and factual – information throughout the year.
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