Guilty Pleasure: Checking My Credit

I was blessed to work as a Loan Officer at an incredible financial institution in my early 20's. It was eye-opening—and depressing—to see how many people came to me to request a car loan, only to be denied because of a slew of collections from places like Blockbuster and Papa John’s Pizza (who knew you could be sent to collections for a Large Pepperoni?!).

I came away from that job armed with some serious knowledge about how to use—and not abuse—my credit. I am the first to admit that I am not the poster child for living a debt-free life (I blame Nordstrom). However, my credit score has hovered just below 800 since I was 20 years old, and I am damn proud of that fact, as are the many lenders who continually try to get entice me with lower interest rates and shiny new car loans…

I am continually surprised at how little people know about their credit, so I’ve decided to put together a series of posts to help you take the first steps towards credit health.

Part I: How to Check Your Credit (for FREE)
Thanks to the U.S. Government, you have the right to pull your own credit report every year. For FREE. What most people don’t realize is that this holds true for each credit agency. That means if you schedule this right (by following two simple steps below), you can actually pull your credit report three times/year for free.

1. Visit this website to pull your report: https://www.annualcreditreport.com
2. Set a calendar reminder every four months, alternating each of the 3 credit agencies.

Example:

• January ’12 – pull Equifax
• April ‘12 – pull Experian
• August ’12 – pull TransUnion
• January ’13 – pull Equifax…
• April ‘13 – pull Experian…
• August ’13 – pull TransUnion… 

This way, you’re getting your free annual credit report every 1 year (but because you’re alternating agencies, you’re able to check your credit for free every 4 months)!

Tips:

• Although FreeCreditScore.com has catchy commercial jingles, they actually CHARGE you to check your credit (go figure). Only use the site above, as it is sponsored by the Federal Trade Commission.
• Do NOT sign up for credit monitoring. This is a monthly fee that is an absolute waste of money, unless you have been the victim of identity theft. Save your $200/year and just follow the calendar I provided above to monitor your credit for free.
• The free credit reports you pull from Equifax, Experian and TransUnion don’t actually contain your FICO score. You have to take another step to actually get your credit score, and this is a paid service ($19.95). I do this step only once/year unless I see something on my report to make me wonder about my score, or if I have purchased a large item or opened a new line of credit recently.

More money, more resources:

• 5 Stupid Money Mistakes We Make In Our 20's
• I wish I had a friend this money-savvy when I was bringing in $1000/night working at a nightclub. I’d have a lot more to show for it 10 years later.
• Learnvest.com
• I love this site! It has completely transformed the way I look at my finances. Mint.com is another good one, but Learnvest is women-centric and incredibly user-friendly.
• 5 Red Tape Traps: Getting a credit score
• Good tips on how to avoid hidden fees and all the red tape that comes with credit checks.