Is It Time to Check Your Credit Report?

Chances are, you know how important your credit score is to your financial life. The higher your score, the lower your interest rates on loans, credit cards, and mortgages. Many landlords, and even a growing number of employers, are using credit information to screen applicants.

So, how’s your credit?

Despite the importance of credit, many people don’t know where they stand. Annually, only one in five consumers checks their credit report, which is a history of your track record of borrowing and repaying banks, credit card companies, and any other lenders.

Of those who do check their reports, many are often surprised by what they see. You may spot an old bill that you forgot to pay that has since gone into collection and is now showing up on your report.

These old bills – even smaller, so-called “nuisance” items such as overdue library fines, unpaid traffic violations, utility bills from past residences, or overlooked medical fees – can quickly become a big problem, lowering an otherwise clean credit score by as much as 100 points. Over the life of an average 30-year mortgage, this one “slip up” could cost you almost $9,000.

Keep it in check

Given that it takes so long to build good credit, it’s important that you be vigilant, and maintain that good credit.

It starts with checking your credit reports regularly. Go to, where you can get one free credit report per year, with no strings attached.

Look over this report carefully as mistakes can – and do – occur. Be sure to look for credit card accounts that aren’t yours, and payments mistakenly recorded as late.

A big mistake could be costly, dragging down your score – which is a numerical value that measures your credit risk based on the information in your credit report – by 100 points or more.

Worse, an error could result in you being denied credit altogether. So if your find errors, notify your creditors or financial institutions and report them to the credit bureaus right away.

Get paid up

Delinquencies have the biggest negative impact on your score, because your payment history accounts for a whopping 35 percent of your credit score. Make sure you pay those off in full.

If you can’t, try negotiating a payment plan with your creditor or collections agency. Then, write to your credit agencies to make sure the settled account is reflected in your report. Old delinquencies, by law, will fall off your credit report after seven years.


Note: The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinion or position of Zillow.

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