As you settle into the season, remember to visit annualcreditreport.com to pull one of your free credit reports—including your Equifax credit report . That way you can conduct a mid-year credit check to see where your finances currently stand.
Lenders use the information in your credit report—like the type of accounts you have open, your available credit, and your payment history—to assess your risk as a consumer, so it’s important that your report contains current and accurate information.
Staying up to date with your credit report and score could also help you detect identity theft or fraud before it gets out of hand, wreaking havoc on your finances—and your emotional state.
Consider these eight questions to help you carefully and thoroughly comb through your credit report for a 2013 mid-year review:
1. Is your personal information correct?
Every credit report will include personal identifying information, including your name, address, Social Security number, date of birth, and employment details. Make sure that all of the personal information is accurate; check to ensure that your name is spelled correctly and your current is address listed.
While an error in your personal information may seem like a basic clerical mistake, it could mean that someone has compromised your identity. For example, someone may have used your identity to open new lines of credit, thereby adding a new name, address, or other personal information to your file.
2. Are there any issues or discrepancies in your trade lines?
Creditors report certain information on your trade lines (otherwise known as credit accounts), including the types of accounts, the dates you opened the accounts, your credit limits or loan amounts, the balances on the accounts, and your payment history for each account.
Make sure this information is correct for each creditor listed on your credit report. Inaccuracies could occur if a credit company has incorrectly reported your payments, but they also could be signs of identity theft.
3. Are all of your accounts in good standing?
Verify that all of your accounts are in good standing, which means you have paid at least the minimum on every account. If you find any negative information, such as debts that need to be paid down or collections that need to be paid off, you’ll be able to make a financial plan to address those issues.
4. Have negative accounts fallen off your credit report after the correct time span?
There are set time periods for how long negative credit information, like late payments, bankruptcies, and judgments, remains on a credit report. Make sure you are familiar with these timetables so you can ensure that negative accounts have fallen off your report after the correct period of time has elapsed.
In general, negative information will stay on your credit report for seven years from the date of last activity, while bankruptcies can appear on your credit report for 10 years from the date of last activity.
5. Do any of your inactive accounts show new activity?
Unfamiliar activity on an inactive account could be an identity theft red flag, but it’s also possible to see legitimate activity after you close an inactive account. Recent activity could still be posted on your credit report if the creditor reports activity, such as changing the report date or the account’s date of last activity.
6. Is there a line of credit that you did not open or that looks unfamiliar?
If a credit card you have not opened is listed on your credit report, your identity may have been stolen and used to open new lines of credit.
7. Is an unfamiliar account, or an account you recognize but did not think was overdue, delinquent or in collections?
One of your legitimate lines of credit could wind up in collections if an identity thief hijacked the account and had the bills forwarded to a different address. An unfamiliar account in collections could also be a sign of identity theft.
8. Are hard inquiries for which you did not apply listed on your credit report?
Potential creditors that are looking into your credit history before giving you a loan or extending a line of credit make what are known as hard inquiries. The inquiry information on your credit report generally covers the past two years. An inquiry for which you did not apply could be another indicator of identity theft.
If you do spot an error when reviewing your mid-year credit report, you can dispute the error with the credit reporting agency, which will then work to resolve the issue with you and the creditor. Equifax allows you to file a dispute online, by mail, or by phone. You can also directly contact the creditor involved with the error to resolve the dispute.
When communicating with a credit reporting agency or creditor, take detailed notes, including the names of the people you speak with, their titles, and the dates of the conversations. If you are told an error will be corrected, follow up to ensure that the correction is made.
Diane Moogalian is vice president of operations for Equifax Personal Solutions with responsibility for operational strategy and execution in support of customer care and fulfillment of credit and identity-related products for consumers. Prior to joining Equifax in 2007, Diane held several strategic roles with leading financial services companies. Diane graduated from the University of Richmond with a bachelor of science degree in business administration (marketing and economics) and earned a certificate in international business from Virginia Commonwealth University.
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