When is a ‘Free’ Credit Report, Not Really Free?

March 13, 2008

On the surface, it seems logical:  You type the phrase “free credit report” in a search engine to access the Web site that offers free reports–which you’re entitled to, by law.

But here’s the catch:  Your search results might not drive you to the one legitimate Web site operated by the Federal Trade Commission.

Q:  What’s the danger in going to the wrong Web site to get your free credit report?
A:  These sites hook you with offers of so-called free credit reports while aggressively marketing other services.  Go to any site other than annualcreditreport.com and you may wind up paying needlessly for services you don’t want.  Or, you could pay $75 for a credit score that otherwise costs $8 to $12.  In one example, a site advertised a “free credit report” but failed to disclose adequately that, if you signed up, you automatically would be enrolled in a credit-monitoring program and charged $79.95.  Many disclosures are in the fine print and easy to overlook.

Q:  What are some sites to stay away from?
A:  The one most heavily advertised is freecreditreport.com.  Other variations include free-credit-reports.com, freecreditreportsinstantly.com, thefreecreditreportsource.com, creditreport.com, creditreporting.com, and nationalcreditreport.com.

Q:  Which site allows access to free credit reports without trying to sell unnecessary services?
A:  Go to annualcreditreport.com, which was established after the Fair and Accurate Credit Transactions Act of 2003 gave consumers the right to obtain–once a year–a free credit report from each of the big three credit reporting agencies:  Equifax, Experian, and TransUnion.  Or, you can call toll-free 877-322-8228.

Q:  Should I order the three annual free credit reports all at once?
A:  You can order them all at the same time.  A better strategy is to stagger your requests throughout the year.  Order a free report from one agency, then wait four months and order a report from a different agency, then wait another four months and order the third report.  After a year, start the process over again.  That way, you’re more likely to detect errors–or even fraudulent accounts set up in your name–than if you wait a whole year to look at all three of your reports.

Another suggestion is to visit any branch of First New York Federal Credit Union.  We can help you understand your credit report and score, and make recommendations on how to improve your score – and it’s REALLY FREE!


Common Credit Report Mistakes Could Cost You

March 7, 2008

If you haven’t requested a copy of your credit report, there are many reasons why you should.

A 2004 study–the most recent available–by the National Association of State Public Interest Research Groups revealed that almost 79% of all credit reports contain some type of error.  One-fourth of credit reports contain such serious errors that those individuals could be denied credit or be charged a higher interest rate.

What are the common errors?

1.  Misspelled names
2.  Wrong Social Security numbers
3.  Inaccurate birth dates
4.  Inaccurate information about a spouse
5.  Out-of-date address
6.  “Closed” accounts listed as “open”
7.  The same mortgage or loan listed twice
8.  Absence of major credit, loan, mortgage, or other accounts that could be used to demonstrate creditworthiness

What should you do?  Review your credit report, at least annually, for accuracy.  If you uncover an error, contact the credit reporting agency to have it corrected.  On an annual basis you can get a free credit report at www.annualcreditreport.com.  In between, First New York members can have their credit report run at no charge, to make sure your credit report is accurate.  Visit any branch office for more information.

Rebuilding Good Credit

February 27, 2008

A good credit score is a valuable asset.  One that will mean lower loan rates, which will save you hundreds or thousands of dollars over the life of a loan.

So, how do you rebuild your credit.  Here are some tips that will help:

Rebuild Credit


Ways To Boost Your Credit Score

October 31, 2007

Every time you apply for a credit card, mortgage, car loan, or insurance policy, your application is judged in part by your credit score.  Lenders use your credit score to determine whether to grant credit, and at what cost.  The higher the score, the more likely you are perceived to repay the credit, and at a lower rate.

Fortunately, you can take steps to boost your credit score. These tips can maximize your score and influence your credit-worthiness AND reduce the rate that you will pay!

1. Be punctual. Late or missed payments, foreclosures, and bankruptcies have the greatest negative effect on your credit score. This accounts for 35% of your credit score, so make sure to pay your bills on time.

2. Check your credit report regularly. Don’t let inaccurate information ruin your credit score. Consumers are entitled to one free credit report per year, which you can get online at annualcreditreport.com. Or visit any branch of First New York FCU and we’ll review your credit report with you.

3. Keep debt in check. Try to keep your account balances below 50% of your credit limit. About 30% of your credit score is based on the amount you owe in relation to your credit limit. For instance, if your credit card has a limit of $2,000, keep the balance less than $1,000.

4. Avoid excessive inquiries. New inquiries for credit account for 10% of your score, and a bunch of new credit requests—in a short period of time—can reduce your score.

5. Keep accounts open. Time is one of the most significant factors that can improve your credit score. Fifteen percent of your credit score comes from how long you’ve been managing credit. Closing old accounts—especially ones with a good payment history—shortens your credit history and lowers your score. Lenders take into account the average age of your accounts, so an older account can help balance newer credit.

6. Keep a healthy mix. The remaining 10% of your credit score depends on the types of credit you’re using. Make sure to have a healthy mix of credit. This includes things like a mortgage, a credit card or two, a car loan, and perhaps a retail card. First New York FCU can help you acquire the mix you need and give you tips on how you can improve your credit score.  Visit us or call us today!