How to Get Your Free Credit Report
Contributed by Frank Giovinazzi
Everyone will be eligible for free credit reports in 2005
Federal credit reporting rules have changed! United States citizens can get copies of their credit reports -- for free -- once every year. The program began in December 2004 for residents of 13 western states, and will expand throughout this year for the rest of the country. Residents of Alaska, Arizona, California, Colorado, Hawaii,Idaho, Montana, Nevada,New Mexico, Oregon, Utah, Washington and Wyoming are currently able to get their free credit reports.
On March 1, residents of 12 Midwestern states will be able to get copies of their free credit reports. Those states include Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota and Wisconsin. To see when the rest of the country will be eligible, see the end of the article.
There are three major credit companies in the United States that keep track of everyone's personal credit history -- payments, loans, credit cards and so on. Thanks to the new federal rules, Equifax, Experian and TransUnion have created a website, www.AnnualCreditReport.com, where people can go to apply for their free credit report online. Consumers can also call an 800-number or request their free credit report by mail.
Consumers can get free credit reports but will have to purchase complete data.
The new legislation, known as the Fair And Accurate Credit Transaction [FACT] Act, requires the three credit firms to supply free credit reports, but consumers will have to pay to obtain the really in-depth information that determines their credit worthiness. Also known as FICO, which is short for a formula created by the Fair Isaac Corporation, this number provides what is commonly known as your credit score.
Consumers are encouraged to use their free credit reports to repair their finances
This new law means that people can get ahold of their basic credit data, such as payment histories, amount of credit available, what's been charged, as well as credit inquiries.
It is this raw data that is used to calculate credit scores, which in turn determines how much credit lenders are willing to offer you, and at what interest rate.
