By now, most Americans understand the importance of credit monitoring as a protective measure against identity theft and reporting errors that may jeopardize one’s financial standing. What may be more difficult is knowing how to read one’s report or the steps that need to be taken to dispute errors. The Better Business Bureau has provided a few tips Americans can follow to ensure their credit report is healthy and error-free.
The actual report will contain a record of all open lines of credit, student loans, mortgage and utility payments and other types of financial information that affects a credit score. The document will also record any bankruptcies or tax liens.
Examining a credit report will also allow consumers to gauge their financial standing. They can view areas where they may be strong, such as paying bills on time. Individual’s may also discover their credit weak spots, such as using too much available credit.
Consumers should review the accuracy of all information on the report and immediately report any errors. A study conducted by the U.S. Public Interest Research Groups revealed that nearly 79 percent of credit reports contained some type of error. If an error is listed on the credit report, consumers should contact credit bureaus and be prepared to submit supporting documentation to disprove the false information listed. Individuals who discover fraudulent charges should contact credit bureaus to request that a “fraud alert” be placed on the report. The police should also be notified and consumers may want to file a complaint with the Federal Trade Commission.
In order to make sure the credit report dispute runs smoothly, individuals should keep records of all correspondence and documentation throughout the process. Maintaining adequate records, including names, phone numbers, and conversation summaries with credit bureau representatives will facilitate resolution.
Credit reports can be viewed as a report card of overall financial health. Consumers should actively monitor their reports in order to protect their finances and, in cases of identity theft, their reputations with lenders. Credit reports also serve as a guideline for the areas in which improvements can be made.