Three Reasons to Check Your Credit Report

You might only think about checking your credit report before you apply for credit. Many people are in this situation. They check their reports before they apply for a mortgage or a car loan. This, though, can be a real problem. To get the most benefit from your credit report, you really should be checking it on a regular basis. This means at least once a year, although checking your report once a quarter is an even better option. Here are three reasons that you want to stay on top of your credit report.

First, credit reporting bureaus are not known for their accuracy. Over 70% of credit reports have serious errors on them that can affect a person's ability to get credit. These errors can take lots of time and effort to fix. This means that if you simply check your report a week before you apply for a mortgage, you might not have time to fix the errors. You could have perfectly good credit but for an error, and the time it takes to fix that error could really put off your home buying prospects for a while.

Second, your credit report is a good way to make sure that you aren't a victim of identity theft. Those who check their reports on a regular basis are much less likely to become victims of identity theft than those who only check theirs when they need to. As soon as someone even applies for credit in your name, that will be reported to the credit bureaus. This is your first line of defense against having your identity stolen. This can be an expensive problem to deal with, so it's much better to check your report regularly so that you know your identity isn’t being used improperly.

Finally, your credit report is a good way to keep on top of your score for free. When you order a free credit report, you won't get your actual credit score. If you know, though, what goes into your score, you can have a good idea of where it will fall by looking at your report. This means that before you apply for a loan or something like that, you can easily spend some time upping your credit score. All you need to do is see what is against you on your credit report and to work to fix those problems.

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Credit Education for College Students

College students these days have plenty of experience with credit. The average student graduates with tens of thousands of dollars worth of student loan debt, and many students even have credit card debt upon graduation. The problem, though, is that many students have absolutely no credit education. They can have degrees in anything but still know absolutely nothing about their credit and the problems it could cause for them later in life.

It's important, then, for parents and other adults to educate college students about credit. There are lots of different ways to go about this. One of the most effective, though, is to simply run the numbers. Like most people, college students are inherently logical, and they'll respond better when something is right in front of their faces. Most students are pretty poor, and they know the value of the dollar. This means that they will respond well if you give them an illustration of exactly what can happen if they go on taking out credit.

One way to do this is to use an online credit calculator. It can show you just how much interest you'll pay on even a small debt over time. You can also use these to show how long it will take to pay off a debt at a certain rate or how much money you'll pay in interest by paying minimum payments. Many students assume that it's okay to make minimum payments, for instance, on student loans. They just don't realize how much more money this will cost them over the life of a loan.

Another way to work with credit education with students is to let them know how much a bad credit score can cost them. Many students aren't even aware that they have credit scores, even if they've had credit cards for years. Talk to your college student about how a poor credit score can affect them before they start to create a terrible score that's too hard to dig out of.

Most college students graduate with big dreams. They want to get good jobs and buy beautiful homes and cars. What they don't realize is that a bad credit score can keep them from getting the job of their dreams, as many employers look at credit scores to get an overall idea of how responsible someone is. Also, a bad credit score can keep someone from getting a home or car loan, so the decisions college students make now can affect their entire lives.

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