Credit Report

For years if consumers wanted to know their credit score, they had to buy it. But starting this year, potentially millions will be able to get their score for free thanks to new federal regulations. Moreover, the score will be the actual one used to determine a consumer's creditworthiness — not one of the knock-offs offered online that can be off by dozens of points. "Knowledge is power," says Ed Rice, general counsel for Zoot Enterprises, which provides software to help financial institutions make credit decisions.

You make concerted efforts to safeguard information from identity thieves — keeping bank card passwords concealed, buying online goods solely from secure websites and refusing to furnish personal information to anyone you don't know. Adults and even teens have become accustomed to these precautions. Surely toddlers and preschoolers aren't vulnerable to such criminal activity. But they are, according to Rebecca Bowman, administrator for the Howard County Office of Consumer Affairs.

You make concerted efforts to safeguard information from identity thieves — keeping bank card passwords concealed, buying online goods solely from secure websites and refusing to furnish personal information to anyone you don't know. Adults and even teens have become accustomed to these precautions. Surely toddlers and preschoolers aren't vulnerable to such criminal activity. But they are, according to Rebecca Bowman, administrator for the Howard County Office of Consumer Affairs.

It's as hard to talk your 20-somethings about money as it is talk to them about sex. Maybe harder. "They are probably having the sex," said Eleanor Blayney, a certified financial planner who often talks to the young adult children of her clients. She was laughing. "But they don't have the money. " Our 20-somethings - perhaps starting out in their first real jobs - don't want to hear us say they are spending too much on the clothes and the car and not saving enough. And they'd rather live on Ramen noodles Monday through Friday than give up going out on weekends with friends.

As anyone who has ever been turned down for a credit card, car loan or mortgage because of a faulty credit report can attest, getting such errors corrected is often a tedious, frustrating experience. Even relatively minor mistakes can result in major delays and inconvenience; at worst, people's lives and reputations have been ruined because credit bureaus have passed on inaccurate or incomplete information about their credit histories.The problem affects millions of consumers. A 1991 study by the Consumers Union found nearly 50 percent of the credit reports contained at least one inaccuracy, and a fifth had an error serious enough to damage the applicant's creditworthiness.

WHEN YOU APPLY for a job, you expect the company to check your references. But do you also expect it to pull your credit report?Tens of thousands of employers take a peek at this slice of your personal life: Do you have big debts, do you pay bills on time, have you ever been sued by a creditor, is there a tax lien on your home or a bankruptcy in your past?Employers use these reports "to serve as a general indicator of an applicant's financial honesty and personal integrity," says Experian (formerly TRW)

If you're thinking about buying a home or refinancing - even if you've got excellent credit - you may want to avail yourself of a forthcoming free service that could help you get a better mortgage rate. Under the terms of a national class action settlement, you may qualify for six or nine months of daily monitoring of your credit file plus unrestricted access to your credit report and score. To be eligible, you need to have had any form of open credit account - a charge card, student loan, auto loan or a mortgage - at any time between Jan. 1, 1987, and this past May 28. An estimated 160 million American consumers can meet that criterion, though eligibility expires Sept.

A lawyer for Lt. Gov. Michael S. Steele said yesterday that Steele is considering whether he will sue a former staffer for the Democratic Senatorial Campaign Committee and possibly the committee itself if additional questions are not answered this week about the employee's efforts to obtain his credit report. E. Mark Braden, who is representing Steele and worked as counsel to the Republican National Committee during the 1980s, said he wants to know whether Lauren B. Weiner, who is expected to plead guilty to a misdemeanor tomorrow in federal court, shared the information she found with her Democratic colleagues or others.

Finally, reading a credit report doesn't require a degree in hieroglyphics.TRW Credit Services, one of the major credit-reporting firms, has produced a document that eliminates the numbers and codes that have confused many consumers."

After news that Democratic Senatorial Campaign Committee researchers reviewed Lt. Gov. Michael S. Steele's credit report, five GOP senators yesterday asked for assurances from that group's head, Sen. Charles E. Schumer of New York, that committee staffers hadn't accessed their personal credit information. A spokesman for the group, which helps Democratic senatorial candidates nationwide, said last week that the researchers had not obtained any other credit reports. But the Republican senators, all of whom face re-election next year, wrote that "the security of our families' finances is too important to rely on the assurances of professional political staff and consultants whose primary focus is defeating us next November."

Credit reports contain information about us that essentially will determine how much we pay for insurance, auto loans and other forms of credit. That's because information in credit reports is used to generate credit scores, which lenders and others use to decide on what interest rate and other credit terms to offer us. That's why a congressionally mandated report released today by the Federal Trade Commission is troublesome. The FTC found that one of four consumers has at least one error on one of the three major credit reports.

The Consumer Federation of America released its second annual survey of our credit score knowledge. The good news: substantial improvement over last year. The bad news: plenty of misconceptions still exist. Let's talk about the second group. The CFA survey found: -     44 percent of consumers knew that a credit score measures risk of not repaying loans, which about one out of five believed. -     One-third thought each inquiry into a credit report reduces a score.

Let's turn to baseball to sum up the Maryland legislative session's impact on consumers: It had a few singles but no home runs. "We made a lot of progress on some really critical issues," says Marceline White, executive director of the Maryland Consumer Rights Coalition. "But there is a lot of work left to do and in some places we had some setbacks. " Last year's legislative session was strong on consumer protections, with Marylanders still reeling from the foreclosure crisis and weak economy, White says.

With 2011 winding down, there's still time for some smart moves to keep your finances in order. Here are some tips that will help you in 2011 and next year: Make charitable donations. Make a donation today by credit card and you'll get the deduction on your 2011 tax return, but won't have to pay the bill until 2012. Clean out closets. Donate gently used clothes and goods for a tax deduction. Goodwill Industries of the Chesapeake is taking donations today from 9 a.m. to 4 p.m. Contribute to college savings plan.

Marlene Partridge and her husband have a six-figure retirement income, no debt and pay off their credit cards each month. Yet when the 62-year-old former teacher from Idaho saw her credit score a couple of years ago, she was disappointed that it wasn't near perfect. "Are the very best credit scores reserved only for the extremely wealthy?" she asked recently in an email. It's a question that often crosses consumers' minds, particularly the most careful users of credit.

Breaking up with a bank can be hard to do — and expensive if you don't do it right. Patsy Pahr of Towson says the mark left on her credit when she tried to close her Capital One credit card years ago came back recently to threaten her business license. And Norman Chase, a retired filbert farmer in Oregon, discovered that leaving $3.21 in an unused checking account led to a debt collector pursuing him for hundreds of dollars. Ending a relationship with a bank takes a little more work than starting one up. Both sides bear responsibility, but consumers should be extra vigilant.

Q: Could you please tell me how to clear up my credit? I have a copy of my Trans Union credit report, and some of the bad stuff on there has been paid off. I keep sending them letters but they still haven't taken it off. What should I do?A: I'd like to be able to help you, but there's nothing that I, or anyone else, can do. You see, a credit report is really a credit VTC history that must include all credit experiences over the past seven years. Bankruptcies stay on your credit history for 10 years.

Last year TRW, the giant credit reporting company, bowed to public and court pressure.Today it's showtime. Starting now, if you want a copy of your TRW credit report you're entitled to get one free. If you want more than one copy within a year, TRW has reduced the fee to $7.50 from $15 per report. And if you've been denied credit, you're also entitled to a free report to help understand why.All this is in response to government complaints and suits filed by the FTC, Michigan and 18 other states over accuracy.

While congressional leaders work to push through a deal to raise the government's debt ceiling, some credit unions that serve federal employees aren't taking any chances. Institutions in Maryland and Washington have developed programs to assist their members in the event Congress fails to raise the government's borrowing limit and Uncle Sam can't pay workers' wages or retirees' benefits this month. They are prepared to offer low-rate or interest-free loans and allow borrowers to skip some loan payments to get through the financial crisis.

When an adult's identity is stolen, he or she often discovers the theft in a month or so, when the next financial statement comes in. But when it's a child who is being ripped off, it can be many years before the fraud is discovered. "Parents have no idea that their children's identities have been stolen until they have become adults and find that their credit report says they are in debt," said Steven Toporoff, an attorney with the Federal Trade Commission's division of privacy and identity protection.