Why You Should Keep Tab of Your Credit Report

Planning to buy a new house or get that much desired platinum credit card? For most people, these can be easily achieved through loans and by sending applications to platinum card issuers. However, contrary to what some people may believe, buying a new house and getting that dream credit card may not be that simple at all for average Joes. It needs a lot of money, luck, and discipline. Especially with the plunging economy, it can be very hard to get that dream house or even that dream card. But “hard” doesn’t mean “impossible”, right? Therefore, no matter how hard it may be, you may still have a chance to achieve what you desire.

Do you know that keeping tab of your credit report can help you achieve these dreams? Yes, you get it right. I do mean your credit report. What does it have to do with getting a new house or a new credit line?—you may ask. Well, your credit report plays a big part because it is what creditors use to assess your credit worthiness. When you have good credit, your creditors may take this as a sign that you have good money management skills, prompting them to provide you with higher chances of getting approved for house loans or credit applications. It is for these reasons why you should review your credit report regularly.

Understanding Credit Report

Your credit report is similar to your monthly credit statement, except that it contains your personal credit history instead of your bills. There are credit bureaus that your issuer reports to. They compile information about your credit behavior according to the data they receive from your creditor and from public records as well. 

Your credit report has four sections, each describing your personal details, your present and previous credit accounts, your tax liens and other public information, and inquiries made by companies to access your report.

Why Review Your Credit Report

This type of document is created by humans. This means that it may not be free from mistakes. As a matter of fact, several credit cardholders have complained about errors in their reports over the past few years. Some protest that their records are not 100% accurate while others complain about omitted information. You have every right to contest erroneous data on your report. Here are some reasons why you should review your credit report on a regular basis:

• Identity Theft Prevention – Most, if not all cardholders, are susceptible to identity theft. If you make it a habit to check your credit report, you can easily spot discrepancies in your account. You can spot whether there are new accounts added to your name or whether there are unauthorized transactions on your credit cards. This way, you can prevent yourself from falling victim to identity theft.
• Monitor Spending Habits – Not everyone has impeccable reputation when it comes to purchases and budgeting. If you are always running out of cash, you can use your credit report to examine your monthly purchases. This can help you keep tab of your monthly budget and even helps keep track of all your current debts. 
• Error Identification – Machines do not fill out your credit report; humans do. There are times when it might contain mistakes on a number, character, or any other element. A flawed transcript can make a huge transformation on your credit score, affecting your present and future in terms of finances.
• Complete Information – Consumers have at least three credit reports. These come from the three main credit agencies, namely TransUnion, Equifax, and Experian. If you find missing information even on just one of these credit bureaus, you should recount it right away. This way, your report will be updated immediately and will have complete data. Consequently, your credit rating will be taken care off as well.

Discovering mistakes in your credit report can be disheartening, but it can greatly make a huge difference if you make it a point to spot them as soon as possible. You are encouraged to question every piece of information you find inaccurate to rectify the circumstance. Be ready to supply documents that they may ask when contesting the items in the report, such as canceled checks and credit card statements. These documents may be needed to rectify the report.