Credit Report

Credit reports are records that keep track of a consumer's financial background including loans, major purchases, and other accounts. Financial institutions base their lending decisions for a consumer based on the information found in these documents. Information is compiled, updated and stored through Equifax, Trans-Union and Experian. There are other agencies that offer financial records, but do so as an affiliate or associate of one of these three, major agencies. Whether the individual receives a credit report locally or through an online source, the information is ultimately from one of these three agencies.

It is incredibly important for the consumer to keep track of what is being reported in credit reports. For a fee, the individual can get a copy from many online sources within minutes or they can take advantage of the free credit report from all three agencies. A new law was passed in 2003, the U.S. Fair Credit Reporting Act, that guarantees every citizen free records through all three agencies every year. The individual may access their free information at the agency's online site or request a copy by mail or phone. The FCRA guarantees each citizen this free information in order to provide greater accuracy to protect each person.

Many companies, businesses and other groups must have access to a consumers financial records before completing any requests for financial assistance, creation of new accounts, purchasing a home, renting an apartment, and many other major decisions. Some employers also require credit reports as part of the application process for hiring new employees. Federal employees also must have a credit report accessed about their credit histories. The information provided through these records can be the factor that determines whether or not a person is hired for a job, receives a mortgage or gets security clearance for some position. The FCRA was passed to further guarantee each citizen more protection from mistakes and offers opportunities for consumers to correct those mistakes with the reporting agencies.

If the consumer requests his or her credit report and finds that there are discrepancies and mistakes, it is important to take immediate action to correct any errors. Generally, it is best to itemize the mistakes on paper and send disputes in writing to the agency. It is common to find that not all three records will be identical if there is a mistake. The agencies sometimes receive their information from different sources and there may be something that was gathered from one agency that the others did not pick up. Comparison is the key to making sure that credit reports are accurate among all three agencies. "Give us help from trouble: for vain is the help of man." (Psalm 108:12)

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