Personal Finance

Keeping your credit report sparkling clean

When it comes to your financial health, it is hard to overestimate the importance of a good credit report and high credit score. Your credit report is used by many people and businesses, including the banker evaluating you for a loan, the mortgage broker deciding what kind of mortgage to offer you, the car dealer determining if you can buy the car you want, and even the potential employer deciding whether or not to offer you a job.

With all this at stake, it is important to do some preventive maintenance on this most important of financial documents. A yearly checkup is important, not just for your physical health but for your financial health as well. So the next time you schedule your yearly checkup at the doctor, why not take some time to schedule a financial health check as well?

Your financial checkup should definitely include a detailed examination of your credit report. As you review the information it contains, be sure to be on the lookout for anything that seems out of place, such as a payment that was erroneously listed as late or not received, or a closed account that still shows as open.

Perhaps the most important thing to look for, however, when reviewing your credit report each year is any accounts that you do not recognize. That is because identity theft is a growing problem, and it can cause huge headaches and problems with credit.

Be sure to review your credit report each year for the presence of accounts you did not open, or inquires on your credit report that you did not authorize. These can be symptoms of identity theft. If you suspect that you have been a victim of identity theft or fraud, be sure to notify the credit reporting agency immediately, and ask that a fraud alert be placed on your account. This will notify anyone who looks at your credit report that there may be a problem with fraud on your account.

Over and above problems with identity theft, a yearly review of your credit report will help you make sure your credit is in top shape. Reviewing the accounts you have open is a good exercise in fiscal discipline as well, and it is definitely a habit worth starting.

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