Do check your credit reports, but don’t pay to get them
There could be some unpleasant surprises lurking in your credit report, as a Charleston area friend of mine recently discovered.
It seems that some years ago he signed up for one of those department store credit cards, the kind they pitch at the checkout counter with offers of a discount on that day’s purchases.
So, he got the store card and the discount, paid the bill in full when it arrived, and didn’t use the card any more.
Except, it turns out he underpaid the bill by $3.
That $3 wasn’t worth the store’s trouble to send him a bill or pursue collection — in fact, they later signed him up for another store card — but that $3 underpayment was enough to stick a 90-day delinquent note on his credit reports. Ouch.
And this came to light only when he applied for a loan.
The way to avoid this sort of situation is to check your credit reports from time to time.
The good news is, it doesn’t have to cost you any money to check and look for blemishes that could hurt your credit. If you find any, you can try and get the item removed from your report, such as in this case by calling the department store and explaining the problem.
If nothing else, you can attach an explanation to your report.
When it comes to getting copies of your three credit reports, there are plenty of companies that will offer to sell them to you, but considering that you can get them at no charge, that’s a pretty bad deal.
For example, lots of South Carolina residents have likely seen the pitches from Experian, the company that operates the ProtectMyID service. That’s the credit report monitoring service that nearly 1.5 million South Carolina taxpayers signed up for, at the state’s expense, after the S.C. Department of Revenue computers were hacked last year.
In my experience, ProtectMyID is an effective service that alerts subscribers when there’s a change in their credit reports.
However, the ProtectMyID alerts also come with marketing suggesting that people should buy additional products.
For example, I have a loan that was recently transferred from one financial company to another — something that happens regularly with mortgage loans. That transfer triggered a change in my credit reports, when the new holder of the loan was recorded.
ProtectMyID promptly notified me by email that information in my credit report had changed. But the email also included, in bold type, the advice that “When receiving an Alert, it’s important to compare your Experian, TransUnion & Equifax Credit Reports for suspicious activity.”
That advice was a pitch for me to purchase Experian’s “3 Bureau Reports and Scores” report, which costs $39.95.
The thing is, anyone can get their credit reports from the three reporting companies at no charge, every 12 months, under federal law. All a person needs to do is visit annual creditreport.com, or call 877-322-8228.
If you like to review your credit more than once a year, you could obtain one of your three reports every four months. For example, you could look at your Experian report in January, TransUnion in May, Equifax in September, and repeat the following year.
If you want your credit score, that’s extra, but costs less than $10.
So, do check your credit, don’t pay for credit reports.
A quick note about last week’s column: I mentioned that power company SCE&G allows customers to pay their bills with a credit card at no extra charge. That’s true if you sign up with them for paperless billing, otherwise there’s a fee.
Reach David Slade at 937-5552 or Twitter @DSladeNews.