Consumer Credit Report Assistance

Some companies offer credit report services to consumers that range from providing identity theft protection to fixing credit report errors. However, there is credit report advice available free online that shows consumers how to get copies of their reports, how to read them and how to correct errors with credit-reporting companies.

Free Reports

An Associated Press report says identity theft was the top consumer complaint filed with the U.S. Federal Trade Commission for the eleventh year in a row in 2010. The AP article, titled "Fighting ID Theft? It Doesn't Have to Cost You," says such data usually causes companies to step up their marketing efforts for credit-monitoring services, which can cost as much as $180 per year. However, consumers can monitor their own credit reports without charge by requesting reports from the national credit-reporting companies through Annualcreditreport.com (see Resources). According to the FTC, one of the best ways to detect identity theft and prevent its damage is to check your credit reports regularly to spot loan or credit account activity that you didn't authorize.

FICO Help

Fair Isaac Corporation developed the FICO credit score used by lenders and others to determine consumers' creditworthiness. The company's website provides information on how your financial decisions affect your credit report and your credit rating. The credit bureaus calculate your credit score based on the information in your credit report. For example, your payment history affects 35 percent of your FICO score, so you can build a good credit rating by consistently paying all of your bills on time. The negative impact of past late payments on your FICO score lessens over time as more recent, on-time payments appear in your credit report.

Reading Credit Reports

It's important to understand how to read your credit reports as you review them to find possible errors. A Bankrate article, titled "How to Read and Understand Your Credit Report," explains what type of information is in a typical report and how the credit bureau documents it. For example, some reports are in what Bankrate calls plain English. This is because they include easy-to-understand notations, such as "never pays late." Other reports may use codes such as "R1," which indicates a good payment history on a revolving account. Credit cards are revolving accounts because cardholders don't have to pay off their balances each month.

Fixing Credit Reports

The FTC website details how consumers can dispute errors in their credit reports. The FTC notes that credit-reporting companies must investigate items that consumers dispute within 30 days. However, the FTC says companies aren't obligated to investigate frivolous complaints. It's important to back up a dispute by sending the companies copies of supporting documents to bolster your case. For instance, send copies of canceled checks demonstrating that you made payments before their due dates if a credit report incorrectly states that you were late.