MSU Extension

One of the best financial practices you can get into is reviewing your credit reports yearly. There are basically two reasons this should become a very important habit. One is to make sure that all the information accurate and secondly to pick up on potential identity thief.

Where do you get a free credit report? The Fair Credit Reporting Act (FCRA) requires each of the nationwide credit reporting companies – Equifax, Experian and TransUnion – to provide you with a free copy of your credit report, at your request, once every 12 months. The Federal Trade Commission enforces the FCRA with respect to credit reporting companies. To request your free credit reports, visit their webpage.

You have a choice of either ordering all three reports at one time per year or to order one every four months. Because nationwide credit reporting companies get their information from different sources, the information in your report from one company may be different from the information you receive in the other reports from the other two companies. Personal financial management experts recommend that you order one of your free reports every four months. For example, request your report from Equifax in January, then from Experian in May and then TransUnion in September. Remember that the law allows you to order one free copy of your report from each of the nationwide credit reporting companies every 12 months.

Once you review your credit report and you find errors, inaccuracies or incomplete information, under the FCRA both the credit reporting company and the information provider (that is, the person, company or organization that provides information about you to a consumer credit reporting company) are responsible for correcting inaccurate or incomplete information in your report.. To take full advantage of your rights under this law, contact the credit reporting company and the information provider. You do not need to hire someone to fix your credit report. Tell the creditor or other information provider, in writing, that you dispute an item. Include copies (not originals) of documents that support your position. Each of the three major credit reporting bureaus specify an address or specific process for disputes. You can create a letter using the “Sample Letter for Disputing Errors on Your Credit Report” located in the “Starting Over after Foreclosure” toolkit. Send your letter by certified mail “return receipt requested” so you can document what the credit reporting company received. Keep copies of everything you send.

Credit reporting companies must investigate the items in question – usually within 30 days – unless they consider your dispute without legal merit or of little importance. They also must forward all the relevant data you provide about the inaccuracy to the organization that provided the information. After the information provider receives notice of a dispute from the credit reporting company, it must investigate, review the relevant information and report the results back to the credit reporting company. If the information provider finds the disputed information is inaccurate, it must notify all three nationwide credit reporting companies so they can correct the information in your file.

When the investigation is complete, the credit reporting company must give you a short written response and describe the results, which include how your report has changed. If an item is changed or deleted, the credit reporting company cannot put the disputed information back in your file unless the information provider verifies that it is accurate and complete. The response provided by the credit reporting company must also include notice that says you can request a description of the procedure used to determine the accuracy and completeness of the information, including the business name, address and phone number of the information provider.

If an item is changed or deleted, the credit reporting company cannot put the disputed information back in your file unless the information provider verifies that it is accurate and complete. The credit reporting company also must send you written notice that includes the name, address and phone number of the information provider.

Michigan State University Extension has a new online toolkit – Starting over after Foreclosure – that has additional information on re-establishing credit and assests after foreclosure. The toolkit is designed to help people who have been through a home foreclosure (i.e. an example of a financial crisis) to help them rebuild their financial lives.

Michigan State University Extension offers a number of educational programs including programs on financial management and housing education. Visit MIMoneyHealth.org where there are a number of educational materials and resources available for free.