Your credit report is a personal financial summary compiled by each of the three major credit bureaus: Equifax, TransUnion and Experian. Each bureau has its own separate report, and the information you find in each of them can vary. You can get a free copy of your credit report from each one of the credit bureaus at annualcreditreport.com.
To Check for Inaccuracies
The information on your credit report is very important, and small mistakes in reporting can negatively affect your credit score. By checking your credit report periodically, you will be able to spot and dispute inaccuracies in a timely manner.
To Monitor Activities in Your Credit Profile
Many people are unaware that their identity has been stolen until the damage is quite extensive. If you check your credit report often, you will be able to spot suspicious activity much sooner, and begin to take steps to resolve the problems. In your credit reports, you will be able to see what inquiries have been made in your account, or what accounts are open and determine which ones were authorized by you. If you are interested in keeping your credit score high, you will be able to see what inquiries have been made to your account recently and determine the best way to limit them.
To See What Inquirers See
The information on your credit report can affect the amount of interest you pay when you apply for a mortgage, car and other loans. It can also affect your ability to get a job, particularly if you have poor credit. By reviewing your credit reports periodically you can get a good sense of what is on your report, whether the information is accurate, and what you can do to improve it.
To Get a Snapshot of Your Credit History
Your credit reports give you a snapshot of how much money you owe in various revolving and installment loans. Having a clear picture of these debts periodically can help you figure out where you stand financially and how to develop a better plan for the future.
To See What Inactive Accounts Have Been Closed
Credit card companies sometimes close accounts after they have been inactive for a while without giving their customers prior notice. Closed accounts cause your credit score to decrease because they reduce the total amount of credit that you have available. By checking your credit report periodically you will be able to see when an account has been closed before making a major financial decision.
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