Credit Champion – Consumer Alert: Free Credit Report Offers - Are they Really Free?

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Have you ever found yourself surfing around online for a Â?freeÂ? credit report? Search statistics maintained by Creditchampion.com indeed show that many people find our website by searching for Â?free credit reportÂ? in the various search engines. So, we felt compelled to clarify what constitutes a free credit report and when you may be entitled to one.

Credit Champion (2/26/05) http://www.creditchampion.com Free credit report offers seem to flood the internet these days. Unfortunately, most companies claiming to give you a free credit report are really looking to sell you something in the long run, such as a credit monitoring service or identity-fraud protection. Once you purchase the service, you will be given a copy of your credit report, usually from just one of the major credit bureaus. Since there are three major credit reporting agencies (Experian, Transunion, and Equifax), you will not see the complete picture if you do not receive a report from each one. Other websites that sell credit reports are resellers for the real credit bureaus and exist to make a profit. Some of these websites are very useful if you intend to pay, and are very convenient as a centralized place to obtain a 3-in-1 report with a personalized account that you can return to at anytime to order more reports; however, you will not receive anything for free. So, how can consumers obtain a free credit report?

Under the Fair Credit Reporting Act of 1970 you are entitled to a free credit report if your application for credit, insurance or employment is denied because of information provided by a credit reporting agency (CRA). The company that you applied to must provide you with a denial notice which will contain the name, address, and phone number of the CRA that was used. You must request your report within 60 days of receiving the notice of the action. In addition, you are entitled to one free report a year (1) you are unemployed and plan to look for a job within 60 days, (2) you are on welfare, or (3) your report is inaccurate because of fraud.

Residents of Colorado, Georgia, Maine, Massachusetts, Maryland, New Jersey and Vermont already have a right to one free report per bureau each year because of laws enacted by those states. However, a new Federal provision enacted in 2003, grants access to free credit reports to all consumers in every state.

According to the Fair and Accurate Credit Transactions Act of 2003, every consumer is entitled to one free credit report each year. The final rule on this Act issued by the Federal Trade Commission in June 2004, provides for a centralized source from which consumers can obtain their credit reports from each of the three credit bureaus.

The centralized source is becoming available in cumulative stages, over a period of nine months, rolling-out from west. The rollout began in December 2004 and will be complete by September 1, 2005. Western states (Alaska, Arizona, California, Colorado, Hawaii, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming) became eligible on December 1, 2004; Midwestern states (Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin) will become eligible on March 1, 2005; Southern states (Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, Oklahoma, South Carolina, Tennessee, and Texas ) will become eligible on June 1, 2005; Eastern states (Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, Vermont, Virginia, and West Virginia), Puerto Rico, and all U.S. territories will become eligible on September 1, 2005.

So, stop surfing around online for a free credit report, most of the offers you will find are not really free. If you do not qualify for a free credit report, you are still better going straight to the actual credit bureaus and just paying the $8 that a credit report costs. Knowing what your credit file says about you is priceless.

Centralized credit report access:

http://www.annualfreecreditreport.com
877-322-8228

P.O. Box 105281, Atlanta, GA 30348-5281.

Contacting the individual credit bureaus:

Experian: http://www.experian.com
1-888-EXPERIAN

TransUnion: http://www.TransUnion.com
1-800-916-8800

Equifax: http://www.Equifax.com
1-800-685-1111

Contact: Credit Champion: http://www.creditchampion.com

References:

Debt Reduction Alternatives

http://www.nldc.us/debtoptions.html

Consumer Credit Articles

http://www.1st-personal-loans.com

Free Credit Report Information - FTC

http://www.ftc.gov/bcp/conline/pubs/credit/freereports.htm

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Chris Robbins
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