4 Reasons to Keep Tabs on Your Credit Report
October 14, 2013
You probably understand how important your credit report is. You know that it’s a record of your credit activities, and that it’s used to establish your credit score, and that others look to your credit report for information about how fiscally responsible you are likely to be.
However, even if you understand the importance of your credit report, you might not be keeping tabs on it as often as you should. Here are some good reasons to check your credit report on a regular basis:
1. Catch identity theft.
One of the first indications that your identity has been stolen might appear in your credit report. If someone is using your name and Social Security number to open new accounts, you might not know, since the statements could be going to a different address.
If you check your credit report regularly, you can see when new accounts – accounts that you know you didn’t open – appear. You’ll catch identity theft sooner, and be able to address the problem.
2. Fix mistakes.
Studies indicate that a somewhat substantial number of credit reports contain errors that can impact consumer credit scores. Certain errors on your credit report can result in you not getting a loan, or not getting the interest rate that you want.
Check your credit report regularly to figure out whether or not something is inaccurate. Fix mistakes as soon as possible so that you don’t end up being held accountable for problems you didn’t cause.
3. Prepare for a major loan.
There are some very large loans that require good credit – at least if you want the best possible terms. Before you apply for a large loan, especially if that large loan is a mortgage, you should check your credit history. You want to make sure that everything is in order, and you need to identify problem spots and fix them before they hinder your efforts.
Checking your credit, and then making sure that you have as good credit as possible, you can ensure that you are getting the best deal for your loan. Good credit can mean savings as large as thousands of dollars over the life of the loan when you get the best possible interest rate.
4. Track your financial progress.
Checking your credit report can also help you track your financial progress over time. If you have fair credit, you can check your credit report regularly as a way to keep you motivated to make positive changes in your financial life. Watch as your payment history improves, and as sketchy loans from your past drop off. This can offer you a bit of encouragement to keep making positive changes with your finances.
Remember to check your credit report regularly. You are entitled to a free report from each of the major credit bureaus once a year via annualcreditreport.com. If you aren’t too worried about your report, you can stagger when you get your free reports so that you get one report every four months from a different bureau. However, if you want to check more often, you might need to be prepared to pay a little more.
Are you keeping tabs on your credit report? Why or why not? What are some other reasons one might want to track their credit report? Leave a comment!
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