Understanding the Concept of Annual Credit Report via National Consumer Reporting Agencies
According to the Federal Fair Credit Reporting Act (FCRA), every American consumer is entitled to a free credit report once a year by national consumer reporting agencies viz TransUnion, Equifax and Experian. This credit report is known as the annual credit report.
A provision of FACTA implemented in 2003 serves as an amendment to the Fair Credit Reporting Act (FCRA). This amendment has the necessary obligations which these nationwide credit bureaus have to adapt into a mechanism for American consumers in terms of an annual credit report.
Goal of these Amendments
The main goal of these acts and amendments was to provide a platform for American consumers to ensure their credit information is correct. A secondary goal was to be able to guard against the concept of identity theft.
The compliance with FACTA is watched over by Central Source LLC, a joint venture of the 3 big nationwide credit agencies. The annual credit report has to be requested by the user; it doesn’t come to your inbox or doorstep by default.
For making the annual credit report easily accessible, Equifax, Experian, and TransUnion have jointed formed the online portal www.annualcreditreport.com. The portal can only be accessed through American internet service providers and cannot be accessed outside United States of America.
Utilizing Annualcreditreport.com
You need to understand that a credit report and a credit score are 2 different things, though these are connected and are dependent on each other. The 3 nationwide credit agencies provide free credit reports, not your credit score. There is a small charge for getting a credit score though.
Any American consumer can register with the site while availing a once a year free credit report. The website requires the following information from you during registration…
- Name
- Address
- Social Security Number
After this, you can select a nationwide credit bureau out of the 3 available (TransUnion, Equifax and Experian).
Here the users are asked some security questions for confirmation related to the identity of their credit report.
There are 2 methods which people employ to utilize this facility; both have their pros and cons.
- Getting all the 3 Reports at One Time
- Getting the 3 Reports over a Period of Time
Getting all the 3 reports at once saves a lot of time and is a lot more convenient, but it shows your credit worthiness at that particular time period only. To check your consistency, you might have to enquire or ask for a credit report again (second time is charged).
On the other hand, if you apply for annual credit reports, each after a certain period of time, you get to know your uniformity in worthiness in terms of credit. This may be slightly inconvenient, but you get to know your standing in the credit market for free, even while considering it over a period of time.
Just as a summarization, you are entitled to receive 3 annual free credit reports (one each from the 3 nationwide credit agencies).
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