by Bill Hardekopf
A report
released by the Federal Trade Commission underscores the need for Americans to
check their credit reports on a regular basis.
The FTC study found that
26 percent of consumers had a material error on at least one of their three
credit reports. Of greater alarm was the fact that 5 percent of the consumers in
the study had an error that, when corrected, placed them in a different credit
risk tier and could result in paying a lower interest rate on their
loans.
This was an eight-year study by the FTC which involved 1,001
consumers and reviewed 2,968 credit reports.
"These are eye-opening
numbers for American consumers," said Howard Shelanski, director of the FTC's
Bureau of Economics. "The results of this first-of-its-kind study make it clear
that consumers should check their credit reports regularly. If they don't, they
are potentially putting their pocketbooks at risk."
The report showed
that consumers can get these errors reversed: four in five who filed disputes
saw a change in their credit report.
Consumers can receive one free
credit report from each of the three credit reporting agencies (Experian,
TransUnion and Equifax) every year at AnnualCreditReport.com.
But
a recent study
by the Consumer Financial Protection Bureau found that only less than 20 percent
of consumers check their credit report each year.
Bill Hardekopf is CEO of LowCards.com, a site that simplifies
the confusion of shopping for credit cards. It is a free, independent website that helps consumers easily compare credit cards in a variety of categories such as lowest rates, rewards, rebates, balance transfers and lowest introductory rates. It also gives an unbiased ranking and review for each card.
