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Free credit report services are different than credit monitoring services. The free credit report is what you are entitled to by law. The credit monitoring services are different.

The Distinction

Every U.S. consumer is entitled to a free credit report by law. However, no one is required to receive a free copy of their credit score. You should remember this when trying to obtain the complementary files to which you are entitled.

It will clear up some confusion and help open your eyes so you are not misled. This is sometimes what happens when people are lured into so-called “free credit reports” or “free credit scores.”

On the other hand, you sometimes monitoring service could be beneficial to you personally. It can help you keep track of your files and it will help you beware of when people are stealing your identity to benefit them somehow.

Usage and Tips

Of course, receiving a free credit report is only half the battle. Knowing what to do with it when you get it and knowing what good it will do is also helpful.

Once you have the credit reports, you need to examine them very carefully. For instance, you should do the following:

• Look for duplicate accounts or accounts that belong to someone else.
• Keep an eye out for accounts which have exceeded the time frame for reporting.
• Find out about the statute of limitations of how long a debt can be reported.
• Make sure you learn how long a creditor can try to collect a debt.
• Once you have found the inaccurate and erroneous, use written correspondence to dispute it.

About Disputes

When examining your credit report you also may need some guidelines to help you dispute errors. You can adhere to the following tips:

• Be explicit and brief in your written correspondence about why the listings need to be deleted.
• May very well take writing a few letters and not just one to get results so to not give up.
• Be patient when in the disputing process. After a creditor receives your dispute that creditor is entitled to take time verify the accuracy of or error of a disputed item.

There are many ways to obtain a free credit report. They are issued by both companies who are following the law but also companies that run a scam. Therefore, you should be careful.

In any case, going through the steps of obtaining a free credit report is quite easy. It is an action highly recommended for anyone who wants to know where he/she stands in the eyes of creditors.

Improving your credit score is one reason to monitor your credit report on a regular basis. However, staring at your history of bad mistakes is not going to solve the problem.

You also need to take action. For instance you can do the following:

Change your attitude about spending. For instance, leave home without your plastic when you go shopping. Only make purchases on them when it is an absolutely emergency such as when your car breaks down. Disciplining yourself will show you that you really can live with less material things.

Consolidate debts to aim for lower interest rates on money owed. In order for this process to benefit you, interest rate would be lower when all combined. It would not make any sense to include the bills that already have a lower interest rate than all your bills added together.

Switch to using debit cards when making necessary phone and online purchases. This will help prevent loss of large sums of money in the event of identity theft, which provides you with a piece of mind.

Negotiate unpaid balances. This will help you settle debts much faster. The one clinch about this of course is that “settled in full” or similar phrase does not look as good on your credit report as would “paid in full.” Still, it is a step forward.

Deal with living a little bit less of a luxurious lifestyle. For instance, you can lease a less expensive but just as attractive apartment. You could also purchase a less luxurious car, and you can find just as high quality clothes at thrift stores.

Prioritize your bills. Of course it is not right to ever be late on any bills. However, you need a place to live and you need electricity. You also need your car if you live too far away. However, you can probably let your phone bill slide a few days.

While trying to seek your credit report there are a number of ways that unscrupulous thieves can take advantage of you. They will find any way to steal your identity and one way would be for them to offer fake “free credit report” opportunities.

The main way they get you is to require a credit card even if it is supposed to be a free trial. However, sometimes they try to cancel and put additional charges on top of the ones you already made.

They also then try to make it difficult for you to cancel your free trial. Then you are stuck paying probably for additional services you no longer even want.

Prevention Tips

Make sure you go to a recommended source to obtain a free credit report. Annual Credit Report.com is probably your best choice, but any comparable to this that are reputable would be fine.

If you must use a credit card because you think the additional credit monitoring services may help you then keep the following in mind:

• Never sign up unless you know the server is secure. This will prevent third-party fraud.
• Never give your credit card number to a company that you do not recognize. This will reduce risk of later becoming the victim of unauthorized charges.
• Make sure you verify the name of the company providing credit report monitoring services. Verisign seal information is one way to do this, or you could check with the Better Business Bureau if you have any doubts.
• Only fill out the information that is required. Be very careful about to whom you give your social security card, driver’s license, birth date, and other information.
• Do not pay for any services you could get for free. For instance, you can have free fraud alerts placed on your annual credit report.

Your free credit report is helpful to you in many ways. For instance, it helps you detect fraudulent activity and it also provides your creditors with information about your creditworthiness.

It can also help you plan for the future. This requires understanding what impact different portions of your credit score might have on you.

If you are a person who happens to be currently in the process of rebuilding your credit, your free report is one of your best guides. It can help you in the following ways:

• It can show you how the size and number of debts you have affects your credit score. Incidentally, it is not the amount of the debts but the number of them that you have that matters.
• If you show on your financial records that the balanced on your credit card limits is less than 25% of the maximum, this helps increase your creditworthiness. Thus, you have a higher score.
• The number of inquiries you make regarding your free credit report while shopping also matters. If you have more than three on your record at any given time this can count against you. You should be careful how many times you make an inquiry about your credit within 90 days.
• Your financial records can also assist you in changing your spending habits. It shows you how you use credit and it will help you cut down on trying to obtain it in the future.