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The Truth About "Free" Credit Reports

If you spend any time watching TV, you've probably seen and heard a trio of guys dressed as pirates singing about their credit woes and how their problems could have been avoided if only they had gotten FREE credit reports from a certain web site.

While the singers were amusing, the company that sponsored them wound up getting in hot water with the Federal Trade Commission. The FTC charged that the company was misleading consumers who were seeking free credit reports. Instead, when folks contacted the web site to receive their credit reports, they were automatically enrolled in a credit monitoring service for which they would be charged a monthly fee.

In order to protect consumers from misleading offers like this, the government's new law -- The CARD Act -- includes rules addressing disclosures about credit reports that became effective April 2. Now companies are required to include a prominent notice across the top of each web page that mentions free reports declaring that the only federally authorized source for truly free credit reports is the web site

Hopefully, this will help people realize that the "free" reports they're signing up for on these other sites likely have some expensive strings attached.

Sounds good, but here's the catch. Companies of course want to avoid sending potential customers to So now, some companies are switching their tactics. In order to avoid the requirement to post a disclosure on web pages offering "free credit report", some are now charging a token amount -- such as $1 -- for credit reports. Others are now advertising "free" credit scores, rather than reports. If you look at the offers closely, you'll see that they are still misleading -- a way to trick you into signing up for credit monitoring or another service.

Here's the bottom line: if you want to obtain a free credit REPORT from TransUnion, Experian, and Equifax, you can ONLY do so at

There is no similar site where you can receive a free credit SCORE. Credit reports do not provide you with your credit score -- this is something you have to pay for. Because access to credit scores is vital to helping improve the financial health of many Americans, a group of Senators is introducing legislation that would allow folks to access their credit score when they access their free credit report.

But until this happens, I suggest heading to where you can buy your FICO score -- the most commonly used credit score -- plus a single credit report for about $16.

Reviewing your credit report is the first step towards improving your credit score because if there is any incorrect or negative information on the report, it can lower your score. If you find mistakes on your reports, you should file a dispute directly with the specific credit bureau. They have the burden of contacting the creditor and asking them to either remove the error, or prove that the information is correct.

Anyone about to borrow a serious amount of money for an important purchase should find out their credit score. You should also check your credit report three to six months in advance of applying for a loan as it can take several months to correct credit report issues and improve your credit score.

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