4 Essential Tips to Free Credit Reports

The information on your credit report can affect several aspects of your life. Not only can your credit score and history affect whether or not you qualify for a loan, but also whether or not you gain employment or an approval for an apartment.

Reviewing your free credit report provides several benefits, including the opportunity to improve your credit score and detect the early warning signs of identity theft. To take advantage of these opportunities, it is essential that you learn more about your report, including the details that the report will contain.

You can obtain a free annual credit report from any of the three credit reporting agencies. However, you can also get a report year-round for free through reputable credit reporting websites, such as Credit Karma or NerdWallet.   

1. How to Get a Free Credit Report from Credit Reporting Agencies

You can receive a free annual credit report. However, keep in mind that there are three agencies that provide this information.

Furthermore, you are eligible to obtain a report from each group annually. The three agencies are:

  • Equifax. 
  • Experian. 
  • TransUnion.

These credit agencies are responsible for detailing the information that is found on your credit report. Creditors are required to report to at least one of the three agencies on a routine basis. The information that creditors report to these agencies include your payment habits and the current balance of your loans. 

The information that appears on your free credit report is used to calculate your overall credit score. a credit score is a three digit number that reflects your credit worthiness and financial history. 

2. Other Methods of Obtaining a Discounted or Free Credit Score Report 

You can also get a discounted or free credit report at any time of the year through other reputable websites. These websites provide you with a detailed credit report and access to your credit score. 

Moreover, many of the websites offer additional services that can help you improve your credit at no additional cost. Some of the best credit reporting websites include: 

  • Credit Karma. You can obtain a free Credit Karma score and report at any time by becoming a free member of the website. Credit scores and reports are updated on a monthly basis and you can set email notifications to remind you to check your new score. Additionally, you have the ability to dispute incorrect information on your TransUnion report directly through Credit Karma since the two sites are owned by the same company. 
  • Credit Sesame. Credit Sesame is similar to Credit Karma in that you can join for free and utilize web tools to help you monitor and improve your credit. Unlike Credit Karma, Credit Sesame updates scores and reports on a weekly basis. 
  • Wallet Hub. Wallet Hub offers free credit reports with options to receive SMS text alerts whenever there is new activity or a change in a credit score or report. This website features a very user-friendly iPhone and Android app that can be used to monitor credit score and review new credit report information. 
  • NerdWallet. NerdWallet offers both online and smart phone app tools that allow you to monitor your credit score and report for free. While most other reporting services only provide scores for one or two credit reporting agencies, NerdWallet provides your VantageScore 3.0, which is a combination of the reports from all three major credit bureaus. 

Looking at your free credit score report will not harm your credit score, regardless of how frequently you choose to view it. This is because reviewing your credit is not considered a “hard inquiry” on your account. 

The only time a review of your credit can affect your score is when an inquiry is performed by a potential lender. This includes when you apply for a credit card, mortgage or auto loan. 

3. Credit Scores and Reports Affect Multiple Facets of Your Life

It is essential that you review your free credit report regularly, as it can affect multiple facets of your life. This is because this tool contain several pieces of information about you and your finances, including: 

  • Your name, most recent address and most recent employer. 
  • The types of loans and debt that you currently have. 
  • Details about any loans that you have, including your credit limit or total loan amount, current balance and payment history. 
  • The age of your credit history. 
  • Details about any closed credit accounts. 

With this in mind, you want to get your free credit score report on a regular basis to understand what, if anything, is negatively affecting your credit. With a high credit score, you are more likely to be accepted for various types of loans and get better interest rates from lenders.

However, financial institutions are not the only entities that may check your credit. In recent years, more employers have begun to check the credit reports of job applicants to identify the most qualified candidates. 

Even landlords have begun to run credit checks on prospective tenants to determine whether or not to accept an application for a rental unit. Therefore, checking your free annual credit report can help you ensure that your score will not hold you back from getting a desired position or home.

4. The Benefits of Receiving a Routine Free Credit Report

Checking your free credit score report at least a few times a year can provide substantial benefits. In fact, monitoring your credit report will provide you with the opportunity to catch any early warning signs of identity theft. 

Generally, if you are a victim of identity theft, certain aspects of your report may be incorrect. You may have an incorrect employer, address or other contact detail listed within your report. If your identity has been stolen, you may also see new credit accounts that you did not open. 

In addition to monitoring your free credit report for any sign of identity theft, reviewing your report on a regular basis can help you improve your credit score. Your credit report includes several important details about your financial history. These details can help you to determine the best way to improve your credit score. 

For example, credit utilization can be a big part of your overall credit score. This is calculated by considering the total amount of credit that you have available on your open accounts, and comparing that to your balances.

Your Guide is Here!

Click to Download Your Unclaimed Assets Guide

If you have a $2,000 credit limit and a balance of $400, then your credit utilization is 20 percent. The lower your utilization, the better. 

Monitor Your Credit