SavvySugar

Free Credit Report Scams Aren't Going Away

SavvySugar — Mon, 09 Nov 2009 12:00:23 -0800

By now we all know about the not-so-free nature of those FreeCreditReport.com services; a few of you even say you've fallen for its misleading practices. But even after the government publicly condemned the site, "free" credit monitoring services - which require you to sign up for a paid service, but promise you can cancel at any time - are popping up everywhere.

One friend recently had a particularly nasty experience with one of these companies while apartment hunting. To hear what happened, read more.

An apartment listing on Craigslist requested that she get her own credit report through a specific company. She filled out all the info and put in a credit card when prompted (ouch), but wasn’t able to access the free report she was promised. A week later, charges showed up on her card, but each time she called the company to cancel, she was sent to voicemail. After some Google research revealed that several fraud alerts had already been filed against the company, she reported the charges as fraudulent to her credit card company.

Savvy as we all may be, it’s easier than you think to get sucked into one of these situations. To prevent this from happening to you, keep the following tips in mind:

Only request free credit reports using AnnualCreditReport.com. You can request a free report up to three times a year, once from each of the major reporting agencies. This site will not ask you to enter your credit card number.

Type the Annual Credit Report URL directly into your address bar, rather than clicking on a link from a third party to reach the site. If you’re redirected to a site that isn’t one of the major reporting agencies (Equifax, TransUnion, or Experian), don’t continue with the process.

If at any point you’re asked for a credit or debit card number, walk away. Companies only request a credit card for one reason: they plan to charge you. Period.

Have you ever had an experience with one of these companies? Do you have any other tips to add?

Four Situations When You're Entitled to a Free Credit Score

SavvySugar — Wed, 06 Aug 2008 09:30:34 -0700

Acquiring your free credit report is relatively simple: Just remember to visit AnnualCreditReport.com for up to three reports each year, not tricky FreeCreditReport.com.

Unfortunately, getting your free credit score isn't as direct. There are certain little loopholes that can get you a complimentary score, but there also a handful of legitimate circumstances that grant you a free credit score - no slick loopholes required. Find out four situations which entitle you to a free score when you read more.

Identity theft: If your identity has been stolen or you have reason to believe it's been compromised, contact the credit bureaus about getting a free report and score.
Denied credit: Contact the agency which reported your score to the creditor that denied your application and request a free score and report.
Unemployment: As long as you're planning on job hunting within three months, you're entitled to a free report and score from each agency.
Welfare: You won't be charged for your credit score if you're receiving welfare.

Source

How to Get Your Free Credit Score

SavvySugar — Tue, 10 Jun 2008 09:34:32 -0700

We're all eligible to receive three free credit reports every year (one from each of the national credit bureaus), but credit scores typically come at a cost of $15.95 per score. There are some unreliable sites out there that may claim to have access to free credit scores, but generally those sites aren't trustworthy.

MyFICO.com is actually a division of Fair Issac, the company that calculates consumer credit ratings for lenders, and is a legitimate source of credit information. They have a promotion going on that includes a free trial of their services, which comes with two free Equifax FICO scores and credit reports. If you cancel the 30-day trial immediately after receiving your free reports and score, you won't have to worry about forgetting to cancel and having to pay for a service that you may not want. The option to cancel online makes it easy.

How to Keep Track of Your Credit For Free

SavvySugar — Tue, 16 Jun 2009 06:30:48 -0700

Most lenders use your FICO scores to determine your credit worthiness, but typically it costs you money to retrieve your own score. You have three FICO scores (one from each major credit bureau) based on the information each bureau keeps on file about you. If you don't want to shell out cash every time you have the urge to check your score, there's a solution for you. To find out what it is, read more.

Ron Shevlin, a senior analyst at research-advisory firm Aite Group LLC, suggests using CreditKarma.com because it "offers a truly free score and advice on how to improve it." According to the Wall Street Journal, CreditKarma works like this: Enter personal information (but no credit card details). The site will use your social security number to get your TransUnion generated score. The site will also show you how your score stacks up against other users and will help identify the major influences on your score.

If you're not in a situation that necessitates knowing all of your FICO scores, and simply want to keep track of your credit, CreditKarma could be a good resource. Don't rely on this avenue alone for keeping an eye on your finances and be sure to take advantage of your free annual credit reports. Shevlin warns that we should expect credit card advertisements on the site - that doesn't mean you should click on them.

Ask Savvy: Should I Transfer My Debt Balance to a 0% Card?

SavvySugar — Wed, 22 Jul 2009 06:30:59 -0700

Dear Savvy,

I have two credit cards with high interest. Should I pay them off with my one card that has zero percent interest to reduce paying over $750 annually in finance charges?

Savvy says: I'm assuming by "paying them off" you mean transfer your existing balances to an introductory rate, zero percent card. There are a number of questions you need to address before making this type of decision. To see my advice, read more.

You need to be clear about when the introductory rate ends and the new interest rate kicks in. Is it higher than the interest rates on your current cards? If so, you could end up paying more interest in the end. Zero interest cards do not exist because credit card companies are generous; they are tools for roping in new customers, and the companies hope to make money off you soon enough.

Also, you should only consider doing this if you can put the old credit cards to bed after you've transferred the balances, so that you don't have a huge amount of existing credit to fall back on. You could just end up deeper in debt. Don't actually close the accounts if they've been open for a long time because that could actually harm your credit score, but ignore them unless you're making small purchases a couple times a year to keep the accounts active (and paying off those balances immediately).

If you decide on this plan of action, use the interest-free period to work on paying down your debt. Put the additional $750 that you'll be saving toward the balance and come up with a plan to pay down your debt that includes making payments beyond the minimum. You don't want to get into the habit of continually opening up cards with low introductory rates and just shifting around your debt - that's not going to make you debt-free.

Obama Lays Down the Law on Free Credit Report Ads

SavvySugar — Wed, 27 May 2009 06:26:10 -0700

The original jingles for FreeCreditReport.com couldn't save the website from getting scrutinized by the law. The credit card reform bill signals a score of changes for the credit card industry and more, as demonstrated by the action taken against the scammy credit report site.

Notoriously, FreeCreditReport.com advertised its ironically named service through commercials that led consumers to believe credit reports ordered on the site were actually free. Too many trusting customers used the site expecting to receive their free report, when in fact they had to sign up for a $15 per month credit monitoring service before accessing a "free" report.

Under the new law, the Federal Trade Commission (FTC) will issue revised rules that mandate advertisers to acknowledge AnnualCreditReport.com as the only place for a free credit report. Expect the new FreeCreditReport.com radio and TV commercials to include this statement: "This is not the free credit report provided for by Federal law."

Were you ever a victim of the misleading advertisements?

Ask Savvy: Why Was My Credit Card Application Denied? Part II

SavvySugar — Wed, 26 Mar 2008 09:52:56 -0700

Dear Savvy,

I'm new at this credit thing and I'm not sure when or why I should check my credit report. I have never had a credit card (still don't) but I got denied for one a few weeks ago and I don't know why. Does checking my credit report worsen my credit score? Does getting denied for a card? How often should I check my credit report and/or score? What's the difference?! Obviously I am not financially savvy! No one ever explained to me how to manage credit so now I'm trying to get some and I'm completely lost!

To see my continued answer just read more

Your credit score is derived from the information on your credit that measures how credit-worthy you are. Your credit report contains information about how responsibly you've used credit and includes details like your history of debt repayment. Your credit score is a number that tells lenders what kind of borrower you are, and in order for a credit score to be generated you must have had credit for at least six months. The higher your score, the more favorable interest rates you'll be offered for loans and credit cards.

Even though you haven't developed a credit history, checking your credit report is a useful tool because it lets you know if you've been a victim of identity theft. If any accounts were opened using your personal information you'll know by looking at the details on your report. You're entitled to three free credit reports each year (one per national credit bureau including Equifax, TransUnion, and Experian), so a good approach is to run your report once every four months using a different credit bureau each time.

If you missed my answer to part one of this question, you can find it here.

Source

Savvy Solution: Boost Your Credit Score High Enough to Get a Loan

SavvySugar — Wed, 27 Feb 2008 12:18:49 -0800

Most mortgage news over the past months have conveyed that lenders are moving from one extreme to another in their loan approval process. If you're thinking about applying for a loan any time in the near future, you should be on top of your credit score and taking steps to polish it for the lender's desk. Not only do you want to be approved for a loan, but you want one with lowest interest rates possible. To find out what kind of score you need and how to boost your number just read more.

Experts say that you must have good credit to qualify for a loan today- a score of 680 will get you a loan in some places but it may have to be as high as 720, and the magic number is becoming increasingly higher all the time.The first step is knowing your score to evaluate how much improvement is needed, and you can get your free annual credit report here. The report is free but your FICO score costs about $15.

Look for errors on your report and send any complaints in writing to the credit bureau. These are the three biggest factors that go into your credit score: your history of paying your bills on time; your credit to debt ratio, which is the difference between the amount of credit available and how much you're using; and how long you've been using credit and managing it responsibly.

When your credit score is generated, the credit bureau will also provide a list of different two-digit numbers called reason codes. You should get your score from all three nationwide credit bureaus (Equifax, Experian, and TransUnion) because the data they collect may be slightly different and the reason codes on your reports may vary from one bureau to another.

The codes are meant to tell you - and lenders - why your score is less than perfect and messages include things like delinquency (late payments) or amount owed on accounts too high. Use these codes to your benefit - they tell you the most important points about where you need to begin on the road to improving your credit.

Source

How Often Credit Scores Are Updated

SavvySugar — Fri, 11 Apr 2008 12:54:38 -0700

Many of you have been diligently paying off your credit cards, and you've been getting a little antsy about when your hard work will be reflected by your credit scores. Since it's not free to get your credit score you don't want to be wasting your money checking it every other week - that's money you could use towards paying down your debt, and there's nothing I hate more than being counterproductive! To see how often you can check you score without it being a waste of time and money just read more.

Your credit score is based on the information that makes up your credit report, so any changes in your report will reflect in your score as well. The FICO website says that your score from a month ago is probably different than what your score would be today. My interpretation of that vague statement is that it's not worth it to check your score within a month's time, and it would probably be best to stretch out that month a few weeks longer to ensure you'll be paying for an updated score.

Another thing to remember is that your score may vary between the three agencies because the information they have may be different at each of them. So, if you're carefully monitoring your credit score and want to get an idea of how much it's going up or down, you may want to consistently use the same agency a few times, consecutively.

Source

TransUnion Class Action Suit: Free Credit Monitoring Eligibility

SavvySugar — Tue, 17 Jun 2008 06:37:34 -0700

TransUnion, one of the three national credit bureaus, has settled a class action lawsuit with winning terms for credit holding consumers. If you had any open lines of credit from January 1, 1987 until May 28, 2008 you are eligible to receive free 24-hour credit monitoring from TransUnion for up to nine months. Find out what the free service includes and how to file a claim when you read more.

According to CNN, you can choose between TransUnion's Basic and Enhanced services. The Basic (valued at $59.75) comes with six months unlimited access to TransUnion credit reports and your TransUnion credit score, and with this option you're also eligible to receive cash from the settlement fund. The Enhanced (valued at $115.50) doesn't allow you to receive any cash payment, but it comes with nine months unlimited access and provides additional services like your insurance score and a mortgage simulator service.

While the vast majority of creditors rely on the FICO score and not the TransUnion credit score, it can't hurt to be updated on changes in your credit report. For more information or to file a claim, visit the settlement's website or call 866-416-3470.