1 in 3 Americans Have Never Checked Their Credit Reports

Americans are entitled to an annual copy of their credit report from each of the three major credit bureaus: Experian, Equifax and TransUnion. It’s free, and it’s a crucial step in maintaining healthy credit. But a third of Americans have never checked their credit reports or credit scores, according to a recent survey from TransUnion.

Everyday decisions and purchases impact consumers’ financial health, which can be easily seen in credit reports. The survey, which interviewed 937 American adults and was conducted by Google Consumer Surveys in September, indicates a large portion of consumers aren’t connecting the dots between past behaviors and current credit standings.

There are many reasons people may not pull their credit reports — fear, apathy or a simple lack of knowledge — but it’s something everyone should add to their financial habits. In a news release announcing the survey results, TransUnion Vice President Julie Springer outlined the importance of these financial tools:

“Your credit report and credit score play crucial roles in achieving your financial goals. With a healthy score and responsible past credit behavior, you will make it more likely for lenders to offer you lower interest rates on mortgages, auto loans, other loans and credit cards — even your property and insurance rates can benefit.”

Of the respondents who had checked their reports or scores before, 24.6% said they hadn’t done so in the last year. There are multiple ways to access both credit reports and scores: Federal law entitles consumers to a free annual credit report from each of the three major credit bureaus — you can get all three at once or spread them out, and there are other companies that furnish credit reports, as well. Some state laws require more frequent access to free credit reports (Colorado, Georgia, Maine, Maryland, New Jersey and Vermont, as well as Puerto Rico), and consumers can also obtain free reports if they are unemployed and seeking work, have been turned down or charged more for credit or insurance, or if they are victims of fraud.

Individuals can also monitor monthly changes in their credit scores for free by using the Credit Report Card from Credit.com — it shows how well consumers are doing in areas that heavily factor into credit scores like payment history, length of credit history, diversity of debt, inquiries and debt usage.

Not only does reviewing this information tell consumers how to manage their credit profiles, it can highlight potentially fraudulent activity. Identity theft can wreck credit scores, so spotting incorrect personal information on a credit report or a sudden drop in credit scores will help an individual address potential fraud before it wreaks havoc on his or her finances.

Image: AndreyPopov