How would you know if a fraudster stole your identity and opened a bank account in your name? It’s a frightening prospect and one victim who contacted us only found it had happened to him when he checked his credit report.
The man contacted us to tell us about the experience. He was lucky. He found out within weeks of the bogus account being set up and was able to act before losing any money. But others might not be so fortunate.
Checking your credit report can help protect you from ID fraud – as well as ensuring you’re in good financial health.
So we were concerned when our investigation into attitudes toward credit reports revealed that more than half of the 1,067 people we surveyed have never checked theirs.
The information in your report goes a long way to helping lenders decide if they will agree to lend to you or not, so if there are any errors, you could be left unable to access the best deals on credit cards, loans and mortgages.
Myths about credit reports
Our survey also found widespread confusion about what information is contained within the report and how it impacts on lending decisions.
A whopping 77% of those we surveyed, incorrectly believe there is an ominous-sounding credit ‘blacklist’ that bans individuals from getting any form of credit at all.
And some 60% think that the credit reference agencies, such as Experian, Equifax and Callcredit, make actual lending decisions (they don’t), and more than half think that checking your report too often will damage your credit rating (it won’t).
How to check your credit report
Another surprising stat we found was that 26% of those who hadn’t checked their report, said it was because they were unsure how to.
Fortunately, there are a number of ways you can find out. You have a legal right to get what’s called your statutory report for just £2. This will give you a snapshot of your credit history but no credit score.
If you want a score as well, plus unlimited access to your credit report, you’ll have to pay around £15 a month to Equifax and Experian for a subscription service (after a month trial).
But you can get your credit report (including a score) for free from Noddle.co.uk (part of Callcredit) or Clearscore.com.
It’s worth saying that the scores agencies advertise as part of their subscription services are based only on the information they have in your report. This differs between the three main agencies as as not all lenders share their information with all three.
Have you ever checked your credit report? If not, we’d be interested to know what is stopping you.
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