Avoid Free Credit Report Scams
There's no way you can have been watching TV lately and not have been assailed by those commercials from companies that offer you a free credit report. It's amazing but people often don't stop and question what financial justification a company would have, running a nationwide advertising campaign, in order to offer a free product to the public. There has to be at least some kind of revenue generation if only to justify the cost of making and running the commercials. Even if they seem to be looking out for you by showing you what could happen to you should you fail to get your free credit report, there has to be some kind of benefit for them in the whole thing.
Common sense tells us that if the ads keep airing, it's because the campaigns are successful in reeling in new customers. At the same time, almost everyone knows that there's no such thing as a free lunch and that "free" is often a bait that scammers use to lure in unsuspecting victims. In that regard, it's relevant to wonder if those offers are really free? Free as in no monetary exchange whatsoever.
The short version of the answers to these questions would simply be "No, they are typically not free", and "Yes, they mostly come with strings attached". If you're the type of person who like more detailed answers, then feel free to read on. A more detailed answer would be that just about any offer you see advertised on TV is NOT free, and so are most of the offers you see online. There are free offers, though, and we can help you sort out the free variety from the paid variety.
Like we said previously, most of the credit report offers do carry a cost. Banks and other lending firms have been touting free credit reports for years now, but what they really are offering is a subscription service where you get to check your credit report any time you want. This service is managed either by them or is the result of a partnership with one of the three major credit bureaus, Equifax, Experian, and Transunion. There are more than 3 credit bureaus operating in the US, but those three are pretty much the only ones that count.
Because of the rise of identity theft, there has been a steep rise in the number of companies in the "identity protection" business. What they typically do is that they offer a "free" credit report, which is linked to a membership service. While the focus in the advertisements is on the free report, the fine print on most of these offers clearly states you are agreeing to subscribe to such a service, usually three months to a year at a time, that charges you a monthly fee. This fee, which can range from $6.95 to $19.95 per month, entitles you to a service that alerts you to suspicious activities, credit inquiries and late-payment notices on your account.
With the enactment of the Fair Credit Reporting Act (FCRA), the "big three" credit bureaus are each required by law to offer their customers a free credit report every year. They're not required to send it to you, though, so you have to actually ask for it. You can do so by mail, by phone, or over the Internet. Be sure you follow the instructions so you can get your free credit report, the one where you really don't have to pay a dime.
Here are some of the circumstances where a free credit report is legally available to you. 1) When a company denies your credit, insurance or employment application based on information that was in your credit report - you have 60 days from the occurrence to file your request. 2) You're unemployed and are planning to look for a job within 60 days. 3) You're on welfare. 4) Your believe your credit report contains errors and wish to review it.
Due to the competitive nature of the banking business, there are some banks in the marketplace that offer a free credit report, and a basic online access service that also gives you your credit score, when you get approved for their credit card or open another type of account. Sought-after credit cards as the premium American Express products, also offer their high-income, low-risk consumers various packages of services, including credit report access and monitoring.
If your needs do not go beyond looking at your credit report a couple of times a year to check for erroneous reports and misuse of your accounts or identity, there's no need to pay a monthly fee for that. Even if you do want to monitor your credit report on an ongoing basis, before you go to a paid service, set up your free reports so that you receive one every four months. If that's still not enough for you, then you can investigate one of the banks or credit card issuers that offers the service as part of a package deal.
Because so many life-changing decisions hang on the status of your credit report, it is essential that your credit report be accurate and that you take the necessary steps so that it remains that way. Monitoring services will only alert you, they won't do the legwork to correct anything that might go wrong. It's your responsibility to ensure that your credit report contains no errors, and you can do that without having to pay for it.
Common sense tells us that if the ads keep airing, it's because the campaigns are successful in reeling in new customers. At the same time, almost everyone knows that there's no such thing as a free lunch and that "free" is often a bait that scammers use to lure in unsuspecting victims. In that regard, it's relevant to wonder if those offers are really free? Free as in no monetary exchange whatsoever.
The short version of the answers to these questions would simply be "No, they are typically not free", and "Yes, they mostly come with strings attached". If you're the type of person who like more detailed answers, then feel free to read on. A more detailed answer would be that just about any offer you see advertised on TV is NOT free, and so are most of the offers you see online. There are free offers, though, and we can help you sort out the free variety from the paid variety.
Like we said previously, most of the credit report offers do carry a cost. Banks and other lending firms have been touting free credit reports for years now, but what they really are offering is a subscription service where you get to check your credit report any time you want. This service is managed either by them or is the result of a partnership with one of the three major credit bureaus, Equifax, Experian, and Transunion. There are more than 3 credit bureaus operating in the US, but those three are pretty much the only ones that count.
Because of the rise of identity theft, there has been a steep rise in the number of companies in the "identity protection" business. What they typically do is that they offer a "free" credit report, which is linked to a membership service. While the focus in the advertisements is on the free report, the fine print on most of these offers clearly states you are agreeing to subscribe to such a service, usually three months to a year at a time, that charges you a monthly fee. This fee, which can range from $6.95 to $19.95 per month, entitles you to a service that alerts you to suspicious activities, credit inquiries and late-payment notices on your account.
With the enactment of the Fair Credit Reporting Act (FCRA), the "big three" credit bureaus are each required by law to offer their customers a free credit report every year. They're not required to send it to you, though, so you have to actually ask for it. You can do so by mail, by phone, or over the Internet. Be sure you follow the instructions so you can get your free credit report, the one where you really don't have to pay a dime.
Here are some of the circumstances where a free credit report is legally available to you. 1) When a company denies your credit, insurance or employment application based on information that was in your credit report - you have 60 days from the occurrence to file your request. 2) You're unemployed and are planning to look for a job within 60 days. 3) You're on welfare. 4) Your believe your credit report contains errors and wish to review it.
Due to the competitive nature of the banking business, there are some banks in the marketplace that offer a free credit report, and a basic online access service that also gives you your credit score, when you get approved for their credit card or open another type of account. Sought-after credit cards as the premium American Express products, also offer their high-income, low-risk consumers various packages of services, including credit report access and monitoring.
If your needs do not go beyond looking at your credit report a couple of times a year to check for erroneous reports and misuse of your accounts or identity, there's no need to pay a monthly fee for that. Even if you do want to monitor your credit report on an ongoing basis, before you go to a paid service, set up your free reports so that you receive one every four months. If that's still not enough for you, then you can investigate one of the banks or credit card issuers that offers the service as part of a package deal.
Because so many life-changing decisions hang on the status of your credit report, it is essential that your credit report be accurate and that you take the necessary steps so that it remains that way. Monitoring services will only alert you, they won't do the legwork to correct anything that might go wrong. It's your responsibility to ensure that your credit report contains no errors, and you can do that without having to pay for it.
About the Author:
We have been advising people for years to get a really free credit report with no trial, instead of having to pay for the service. For more of the same type of money-saving tips, visit our personal finance blog.
posted by Credit Counseling at
3:32 AM
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