One of the most important financial tools a consumer has is their credit report, a history of their financial activity and payments. This information is used to calculate your FICO score, used by financial institutions and lenders to determine if you are a good credit risk. If your FICO indicates that you will likely make payments when you should, lenders will be more willing to extend credit at lower interest rates. The higher your FICO score, the better credit risk you are.
Because your credit report and FICO score are so important to your finances it's a good idea to look at them at least once a year. Because of thevalence of fraud and identity theft, you need to be aware of any changes in your credit report and FICO.
You may wonder how your credit can be hijacked if you physically keep your credit cards safe and guard your other information carefully. All it takes is for someone to purloin one of those many credit card offers that litter your mailbox (and trash can!). Even inexperienced identity thieves can use just one of those unwanted offers to apply for a credit card in your name and build a history for themselves from that point. So you see why it's so important to make yearly or more frequent checks on your credit report and FICO score. There may also be errors on your report that need correction.
It's simple to go online and get a free credit report once per year. Simply access the sites of the three credit reporting companies and fill out a request online. Experian, Equifax and TransUnion will each give you free access to your report once per year. You can also check it more frequently for a small fee each time past the free annual request. If you've recently moved, closed or opened a credit account or paid off a debt it would be wise to make sure that your credit report reflects those changes. You can also make a request in writing through the postal service but it will take longer for your report to reach you.