How to Check Your Credit Report For Free

Photo by Sora Shimazaki

Data breaches are an unfortunate part of modern life. We have had to put up with them for some time, and they probably won't go away anytime soon. The latest breach that caught my attention involves a company that manages data for school systems, leading to data breaches for both children and adults. Preventing the breaches themselves is usually out of the hands of consumers, and let's face it, your data is probably already out there anyway. Fortunately, financial institutions and credit card companies are getting better at detecting fraudulent behavior when it happens to you. Ever gotten a call or a text from your credit card company about a fraudulent charge before you even noticed it?

But what if your identity has been compromised, and you don't even know it? What if your existing credit card wasn't attacked, but a new card or line of credit was opened in your name instead? The bank can't contact you about fraudulent charges because, well, they don't know that the you on the account isn't really you when the account is opened with your social security number and other fraudulent information. 

‍Accessing your credit report for free

This is where having the ability to access your credit report can be a valuable tool in detecting and reporting identity theft before the problem gets out of control. In the early 2000s, the Fair Credit Reporting Act and the Federal Trade Commission (FTC) made getting your credit report a lot easier and made it free by establishing annual access rules. 

Let me emphasize the FREE part for just a moment. As the world and much of our purchasing transactions and data went online, the credit monitoring industry popped up. This is not to say that credit monitoring in and of itself is bad, but there are many "impostor" sites out there offering to provide you a credit report, and your credit score, and continuous credit monitoring, and tips on improving your credit score, etc. etc. for a fee. This is far more credit monitoring than is necessary for most folks, and it won't necessarily stop a criminal who has purchased your data from somewhere on the dark web from accessing your credit or personal accounts if you aren't implementing other good information security measures (more on that below). And if you really end up on the wrong site, they could be there to collect and resell your information, worsening your information security problem. The FTC also talks about that in the "Avoid Other Sites Offering Free Credit Reports" section of their site. 

The only government-authorized site for accessing your free credit report is www.annualcreditreport.com. AnnualCreditReport.com offers access to credit information from the US's three main credit reporting bureaus: Equifax, TransUnion, and Experian. Initially, the law allowed consumers to access their credit reports from each bureau once a year. Doing a quick review once per year is probably sufficient for most. If you wanted to be more diligent, you could pull one report every 4 months from a different credit bureau for more frequent checks, as they should all be carrying the same information (for example, TransUnion in January, Equifax in May, and Experian in September, and repeat). Since then, the once-a-year restriction has been lifted in favor of once per week. I am not suggesting you check your credit once per week. You've got better things to do with your time than that. However, this more frequent access comes in handy if you've checked your reports in January and decide to go car shopping in August. You can grab the reports again, without restriction, to ensure there is nothing fishy on the reports before you apply for that auto loan. 

‍What to look for in your report

Your credit report is likely to be many pages long. Each report from each bureau will be slightly different, but they will generally contain the same information.

• History of credit accounts 
  
  • Accounts you have now and accounts long forgotten (remember that credit card you opened to get a free T-shirt in college?)
  • Make sure there are no incorrect late payments or past-due balances.
  • Ensure the account status is "pays as agreed" or some indication that it is in good standing.
  • If the account is closed, again, ensure it was paid and closed and does not indicate any kind of charge-off, settlement, or that it was sent to collections. 
  • Make sure there are no accounts you don't recognize, especially accounts with balances. 
• Mortgages and other larger loans
  
  • Once again, check for indications that the loan was consistently paid on time, such as lots of green checks and no mystery accounts. 
  • Similarly, if the loan was closed or paid in full, ensure the status reflects that. A mortgage may indicate it was transferred to another servicer. 
• Personal Information
  
  • A list of all addresses you have been associated with that is known to the credit bureau (Have you ever signed up for a new service and been asked to verify an address you lived at 15 years ago?)
  • Again, we are looking for any kind of mystery information. Are there any addresses or phone numbers you don't recognize? 
• Credit Inquiries
  
  • Credit inquiries include "Hard Inquiries," which are typically associated with an actual attempt to secure new credit and can negatively impact your score, and "Soft Inquiries," which are typically companies you already work with just checking to make sure your credit file is still in good shape and do not impact your credit score. Your request to pull your credit report might be listed under the soft inquiries.
  • You know the drill: Make sure you recognize all your credit inquiries. Hopefully, there aren't too many. 
• Additional Sections
  
  • Judgements, Liens, Accounts in Collections, etc.
  • Once again, hopefully, there is nothing listed in these sections. At least nothing you don't already know about. 

‍Where's my credit score?

‍One thing you won't get is your credit score. But who cares? You'll most likely be offered the ability to pay for it in tandem with other services, but don't fall for it. Pulling your credit report is not about finding out your credit score. It's about making sure you have a clean credit history. Having a good, clean credit history is important, but pulling your credit report will help to verify that. Unless you are getting ready to apply for credit, your credit score (the actual number) isn't that useful to you. If you really want the number, many credit card companies provide the credit score free to borrowers anyway, so log onto your account online and see if they have your score there. 

‍What to do if you find issues

‍Hopefully, your credit report adventure is uneventful. But I've had clients with reports showing late payments that weren't actually late and accounts that were agreed to have been paid showing as a charge-off. Hopefully, you won't find that someone has opened a fraudulent account in your name or run on a balance on a card that you didn't know you had. If you do:

1. Contact the bank or financial institution holding the account to report the fraud. Contact information should be included with each account in your credit report. 
2. Contact all three credit reporting agencies to report the fraud. The report should include information on how to dispute your file. 

‍Other ways to prevent identity theft (or at least make yourself a more difficult target)In addition to checking your credit report regularly for any unauthorized activity, there are some basic steps to protect yourself from identity theft as well as you can. 

1. Change your passwords regularly. 
   
   1. I know it's a pain, but if your password has been compromised, fraudsters can easily access your online accounts and wreak havoc. 
   2. If you are worried your information was involved in a recent data breach, change your passwords immediately. 
2. Use complicated, difficult-to-break passwords. 
   
   1. Take the recommendation to heart for long passwords with letters, numbers, and special characters. 
   2. And please, please don't recycle the same password on multiple sites. 
3. Consider using a password manager to help create complex passwords and make changing passwords easier. 
4. Use 2 Factor Authentication (2FA)
   
   1. Yes, it can be a pain to get a text or email code every time you access a financial website. But that means it's a pain for the hacker, too, and they are more likely to move on to your neighbor, who might not have 2FA enabled. 
5. Don't click links in email - open your web browser and go directly to the website. 
   
   1. As phishing emails (attempts to send you phony emails that look real) get more sophisticated, mistaking a fraudulent email for a real one becomes more of a concern. 
   2. Have you received an email with a link to a suspicious PayPal invoice or a warning that your Amazon Prime account has old credit card information and will be shut down? 
   3. Instead of clicking the link, open a web browser and log into your account that way. If your credit card company, PayPal, Netflix, or anyone else wants to tell you something, you can surely go straight to your online profile for the information and update. 

As consumers in the 21st century, we are constantly fighting over the security of our data and online identity. Fortunately, we have quite a few tools to monitor our credit and make it more difficult for fraudsters to target us. Keep an eye on your money, and stay safe out there!