Is a Free Credit Report Accurate?

Offers for free things are usually followed by asterisks, tiny print, “buts” and “ifs.” That’s not the case with free annual credit reports.

Credit report information can vary, depending on when you request it and the credit bureau compiling your report, but as far as whether there’s a difference between free credit reports and ones you pay for? There isn’t. Free credit reports are no better and no worse than reports you get by paying for them.

That said, there are limits to how many free credit reports you can get. Under the Fair Credit Reporting Act, U.S. consumers are entitled to a free annual credit report from each of the three major credit reporting agencies: Equifax, Experian and TransUnion. Residents of certain states can get free credit reports more frequently, as their state laws mandate. You may also access a free credit report under certain circumstances, such as if a potential lender denies your credit application. (In that case, you’re entitled to a free copy of the credit report from the bureau the lender used in the decision.)

Even with all those ways of getting free credit reports, many people find it worthwhile to buy additional reports.

“If you’re planning on making a major credit purchase, you may want to pay for a report to verify you’re in the right place,” said Rod Griffin, Experian’s director of public education. “In most cases, you don’t need to pay for your report, but if you’re trying to improve your credit … it can be a worthwhile thing to do.”

With some credit monitoring services, you can pay a monthly fee for a credit score and unlimited access to your credit report, while some offer identity theft alerts and the option to purchase credit reports at a discount. The ability to check that information often can help you spot unauthorized use of your accounts or see how your financial behaviors impact your credit standing.

You can also accomplish some of the same goals with free products — it all depends on how frequently you want to review your credit. You can get a free credit report summary every 30 days on Credit.com, which can help you spot fraud and track your progress as you try to improve your credit.

The important thing to know is you have a lot of ways to get your credit information, making it easy to be an informed consumer. You can spend months researching the loan, credit card or home you want, but if you don’t know how your credit standing fits into those ambitions, you may not make smart decisions.