Free Credit Reports for All | Consumer Debt Group


Free Credit Reports for All

Starting December 1, 2004, residents of Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, New Mexico, Nevada, Oregon, Utah, Washington and Wyoming can get a free copy of their credit report from each of the nation's three major credit bureaus once every 12 months.

By September 2005, residents of all 50 states will have the same opportunity. The remaining U.S. states will be deployed as follows: Mid-Western states- March 1, 2005; Southern states - June 1, 2005; and Eastern states and other U.S. territories completing the rollout on September 1, 2005. Free credit reports were mandated by the Fair and Accurate Credit Transactions Act of 2003, the reincarnation of the Fair Credit Reporting Act.

Consumers can request their reports from Equifax, Experian and TransUnion from a single, jointly operated Web site, address or phone number. They can get reports from all three bureaus at once or stagger their requests throughout the year. The new law also requires the bureaus to offer customers, for a reasonable cost, a credit score based on the information in their report, along with an explanation of the key factors used to calculate the score. Many lenders charge interest rates based on an individual's credit score.

Those who check their reports on a regular basis should be able to spot and correct potentially costly errors and make life harder for identity thieves. A survey by the California Public Interest Research Group found that 25 percent of credit reports contained serious errors that could result in the denial of credit, such as false delinquencies or accounts that did not belong to the customer. It found that 54 percent of reports contained less-serious errors.

To request a report, go to Annual Credit Report (the address must be typed in your browser). You can also request a free report by calling (877) 322-8228 or mail a request to P.O. Box 105281, Atlanta, GA 30348-5281. At the Web site, you first enter some basic information, such as name, address, Social Security number and date of birth. Next, select the bureau or bureaus from which you want a report.

Most nationwide lenders report your loan-payment information to all three bureaus, but smaller lenders may report to only one. For example, in California, it is likely to be Experian, because it is based in Costa Mesa (Orange County). After selecting each bureau, you will be asked some questions to verify your identity. For example, you may have to identify your mortgage company or the balance on a credit card.

After your identity is verified, you will get an instant online copy of your credit report, along with directions on how to correct an error. People who request a report by phone or mail may have to wait up to two weeks. The report can be printed or copied into a computer file.

You also will be asked if you want to buy a credit score and whether you want to sign up for or purchase any additional services. If you opt for additional services, even if they are free, you will become a customer of the credit bureau and could start receiving other marketing pitches so beware. If all you want is your credit report and score, you should not be bothered again.

Here's what each bureau will offer when customers obtain a free credit report: Equifax For $6.95, you can purchase a basic FICO score. FICO is the brand name for credit scores based on a formula developed by Fair Isaac Corp. Although all three credit bureaus sell FICO scores to lenders, Equifax is the only one that sells FICO scores to consumers. The other two sell proprietary scores. Equifax is offering two additional services from the free credit report site, both at no charge. Experian For $5, Experian offers its own Plus credit score. Although their formulas are different, all three bureaus report scores on the same basic scale developed by Fair Isaac, so a score of 750 from all three bureaus will be roughly comparable. Experian is offering a new credit-monitoring product, called Triple Alert, exclusively to free-credit-report customers. For $4.95 a month, customers will get same-day notification anytime someone seeks credit in their name. The consumer can be alerted by e-mail or text message to their cell phone. We suggest that you buy an inexpensive credit score and get a free copy of your credit report from each bureau every 12 months, staggering them throughout the year instead of purchasing a credit monitoring service. Also, in California, victims of identity theft can get a free credit report every month for a limited time. TransUnion TransUnion will offer a proprietary credit score for $5.95, credit monitoring for $10.95 each quarter and a one-time debt analysis for $5.95.

At myfico.com, you can buy one credit report and one credit score from one bureau for $12.95, or you can get reports and scores from all three bureaus, plus a FICO simulator -- which shows how certain credit moves would affect a score -- for $38.85.