Free Credit Report

Every American is entitled to one report from each of the credit agencies -- Experian, TransUnion and Equifax -- each year under the Fair and Accurate Credit Transaction Act.

A lot of web sites, including those of the big credit reporting agencies, will try to lure you in to sell you those reports, but that is a good way to spend money needlessly. At annualcreditreport.com the reports are available free. (Those who are uncomfortable submitting their Social Security number online can mail a request to Annual Credit Report Request Service, PO Box 105281, Atlanta, GA 30348-5281. If you order a report from one agency, then come back in three to four months and order from another, you can keep on top of any credit changes.

The report can be difficult to read, but you first want to check for accounts that are not yours. Next, make sure the report is clear of any erroneous information like a bill turned over to a collection agency or a credit card balance that was paid off.

If there is a mistake, write a letter to the credit bureau and correct it. Then immediately order free copies from the other two agencies to make sure the error is not repeated on their reports.

Remember, asking for a report directly from a credit bureau never hurts your credit score.