Free Credit Report By Law
2010
Are Free Credit Reports Really Free?
I see a lot of ads for free credit reports these days. Some are catchy TV ads with baby faced rockers lip syncing the jingle. Others are lined up on web pages. They all advertise free credit reports.
But how can companies spend all of this money promoting a free service? Most people have to know that few really free lunches are around. Sometimes they do not cost anything. But they are also deisgned to get members to sign up for paid offers.
One popular and highly exposed website has thousands of Better Business Bureau complaints right now. When a visitor registers, they must supply a credit card number. The consumer’s credit card would get hit with a bill if the additional credit monitor was still active.
Is this obvious to the consumer? All of those many consumer reports to the BBB would tend to make me think it is not. Many users signed up for the free service, and they were very surprised to see credit card charges.
I am guessing that many thousands more got charged and did not bother to complain. The charge may not even have been noticed by some of the people who register. The company was probably betting this would happen, and that’s how they can spend a lot of money on a free service.
There actually is a US federal law that entitles consuemrs to free credit reports every year. That website is annualcreditreport.com. The 3 big credit reporting agencies all participate so they can comply with the law.
You can get your credit report once a year. Then you can check it for errors. It is very interesting to see a credit report, and you really have every right to see your own information.
Why should you bother to get a free credit report?
Many reports contain errors. These can have a negative affect on your credit score. As you know, lower credit scores mean you pay more for a variety of things. Loan and credit card companies offer better rates to people with high credit scores. Some insurers never offer their best rates to those with credit problems. And these days, many employers use credit as one way to screen applicants.
Since your credit can affect how much money you have to pay, and even how much money you might make, you should never leave it to chance. You should be able to look for errors on your own reports. It is also very simple to dispute errors that you find. Credit bureaus must act on any error reports. They side with consumers a lot of times too.
I looked at my own report and found a couple of duplicates. These errors reported a much higher outstanding loan balance than I had. I also found one credit card that was listed as closed. That card was open and paid up.
Since potential creditors will look at how much credit you have vs. how much you use, this was not good for me. I did dispute the errors, got them fixed in a timely manner, and then saw my credit score rise by about 20 points. I am sure that this has saved me time and money.
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