Free Credit Report

The Fair Credit Reporting Act guarantees that borrowers can acquire a free copy of their credit report from each of the three consumer reporting agencies once every 12 months. Borrowers can also request a free credit report if they are turned down or offered reduced services for credit, employment, housing, or public benefits based on a credit report.

• The page How to get a Free Credit Report gives step by step instructions.

Many organizations advertise free credit reports. However, these sites are not required under the Fair Credit Reporting Act to give you a free credit report. Typically, what these sites will do is put you into a "credit monitoring service" and you will be charged for this monthly service 30 days after you request your credit report - unless you cancel the membership before the 30 days has elapsed. Many people either forget to cancel this membership, or they don't realize they've been placed into a membership. The fee is generally pretty high at around $80-$90 per month. So remember to always read the fine print when ordering your credit report from these sites.

• Pay down your credit card debt so that the balances are below 30% of the limit.
• Dispute any old negative reportings - you have a 50/50 chance that the collection agency won't investigate it, which means it must be removed from your credit report.
• Correct any significant errors being reported on your credit report.
• Always pay your bills on time.
• Don't open a lot of new accounts too rapidly.
• If you have any current accounts in collection, as the collection agency to remove it from your credit report if you pay the balance (get this in writing).