The Fair Credit Reporting Act (FCRA) gives all Americans the opportunity to check their credit score and report with all three major credit reporting agencies annually at no cost to them. The companies that maintain consumer credit reports are Equifax, Transunion, and Experian.
Consumer advocates recommend that people take advantage of this offer to monitor their credit score. It is also a great time to ensure their report does not contain significant errors. Under the FCRA, you may dispute any information you feel is incorrect and the credit reporting agency must remove it or provide you with a reason why it is accurate within 30 days.
While obtaining your credit report at least once a year is a good idea, there are times you may want to request it more often.
Request Your Credit Report if You Think You Have Been a Victim of Identity Theft
Having your identity stolen by another person who opens credit in your name is a difficult experience even when you know it has occurred. The situation is significantly more stressful when you have no idea someone obtained your identity and only learn of it when a creditor denies your request. You could also start receiving collection calls for debt you never incurred. Requesting your credit file a few times a year allows you to learn of identity theft sooner should it occur.
Other Times to Check Your Credit Score and Report More Often
An October 2018 article from U.S. News and World Report states that consumers should consider checking their credit report approximately every three months in certain situations. For example, obtaining your credit report with a credit score four times a year can be helpful when you are working to improve a low score. The data will show where you have made progress and where you still need additional work to clean up your credit file.
When you plan to apply for a major loan such as a mortgage, frequent requests can be a good idea. Reviewing your credit report every few months allows you to correct mistakes that could hurt your chances of approval while also giving you insight into how you can make your credit profile stronger.
Does Checking Your Credit Report More Than Once a Year Hurt Your Credit Score?
As Credit Karma explains, a consumer requesting a copy of their own credit report counts as a soft inquiry. A hard inquiry is when a creditor pulls your report after you apply for some type of loan.
While too many hard inquiries can temporarily reduce your credit score, soft inquiries have no impact whatsoever. Lenders understand that soft inquiries do not represent an application for credit and typically pay no attention to them. Meanwhile, applicants with several hard inquiries in a short time can be viewed as an increased credit risk.
About Credit Report Fees
Checking your credit report more than once a year will cost you money, but there is a way around it. You could request your file every four months from a different credit reporting agency. This would keep you within the guidelines of the FCRA. Keep in mind that some employers hiring gig workers request credit reports and too many problems on your file could disqualify you.
About the Author: Lisa Kroulik has worked as a freelance content marketing writer for 10 years. She loves the work and the lifestyle it affords. Learn more about Lisa’s work and availability through Writer Access.