BANKRUPTCY UPDATES

Don't Delay-Check Your Credit Report Today!

A survey conducted in June by BankRate.com, a financial-advising website, found that 32% of American adults have never checked their credit reports.

The report suggests that the number may be a conservative estimate, but even so it's higher than it should be.

Many consumers are apparently "flying blind" as far as their credit goes, and that can have dangerous, costly results, potentially including filing bankruptcy and foreclosure.

So why should you check each of your three major credit reports once a year? Here are some of the most important facts many people don't know about credit reports:

• Credit reports often contain mistakes. If you don't check them yourself, they will never be corrected. If left incorrect, these mistakes can cause you, the consumer, to lose money.
• Identity theft can be avoided by checking your credit report regularly.
• The information in credit reports affects even those who "don't use credit" very often. Car insurance, apartment rental conditions, and cell phone policies are among the "non-credit" items affected by your credit report. (Translation: you could be paying more than you need to for these if your credit report is incorrect!)
• Everyone is allowed to have one free credit report per year. Free.
• The consumer-protection afforded by credit reports works only if consumers are checking their reports regularly. If you don't know anything's wrong, you're not going to take action to fix it.
• You do NOT have to provide any of your credit card information, sign up for any credit cards or offers, or purchase any memberships or services-not even on a trial basis-to get your free credit report.

According to BankRate.com, those with bad credit are no longer turned down when applying for loans, they're simply charged more.

So if you haven't checked your report, you don't know whether you're being charged based on information that's correct or seriously flawed.

Additionally, the survey found that nearly half of Americans have never checked their credit scores.

The credit score is based on the data in the credit report, but gives a more detailed breakdown of specific credit functions, like debt-to-loan ratios. Knowing your credit score can help you understand the cost of your insurance and credit.

Interestingly, the poll also asked participants how their current credit situation compared to their situation of a year before.

Nearly half answered that their credit was better at the time of the survey. Some of those who responded positively to this question also admitted that they'd never checked their scores.

This is a significant piece of information. It's important to remember that having a "general idea" of how you stand financially is not good enough, and may not be accurate.

BankRate.com reports that consumers often mistakenly guess their own financial standing, whether they estimate too optimistically or too pessimistically.

The important thing to remember is that you cannot know for sure how your credit stands unless you check. And once you do check your credit report, you'll be well equipped to understand how it’s affecting the transactions you make every day.

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