Credit Reporting Agencies - The Big Three

In the United States, dozens of credit bureaus keep track of whether we pay our bills as agreed. However, most people only need to concern themselves with 3 credit reports from Equifax, Experian, and TransUnion. Virtually all potential lenders and landlords will check one or more of these documents when deciding whether they will conduct business with you. Thus, it is important to check at least the big 3 credit reports every year.

A common mistake people make is falling for "free credit report" scams. Virtually all websites that advertise complimentary copies of the 3 credit reports are very interested in getting your credit or debit card information. Yes, you may initially get one or more free copies of your credit files. However, within one to 30 days you will typically be charged for a credit monitoring service. The fine print was that you could get a "free" credit report, but only as part of a "free" trial. If you did not cancel the trial of the credit monitoring service within a specified time period, then you will be charged a monthly or even an annual fee.

Also, many of these "free" reports have inaccuracies. The best way to get your 3 credit reports is by using a government-approved website called AnnualCreditReport.com. The Federal Trade Commission, a government organization designed to help protect consumers' wallets, does not endorse any other website for the purpose of getting truly free copies of the 3 credit reports.

Alternatively, you can write or call Equifax, Experian, and TransUnion. However, it will be much easier for you to go through the brief identity verification process at AnnualCreditReport.com. You will never be asked for any type of payment information and the website is very secure. In fact, you can't even see your own 3 credit reports until you prove your identity. The typical standard for identity verification is for the computerized system to offer two to four multiple-choice questions. The areas covered could include previous streets or cities of residence, names of relatives or roommates, names of current or past lenders, and the monthly payment range for one of your existing loans such as a home mortgage. If you cannot complete this process online, you must send a copy of your passport, military ID, or driver's license along with a copy of a bill that proves your address. Then you will get the 3 credit reports through postal mail.