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Lesson One: Check Yourself

So you know how important your credit rating is, right? Having good credit means it will be easier for you to get loans and low interest rates. Low interest rates usually translate into smaller monthly payments. That’s important when you borrow money for a car or a place to live. Sometimes, people even check your credit when you apply for a job.

Don’t Believe What You See on TV
So, do you know how to check your score the safe way? First thing’s first, don’t use any of those “credit check” infomercials you see on TV. They’re just making you pay for a service you can get for free. Here’s where you get the real scoop:

This Check Won’t Bounce
You can get a real credit report from three different reporting companies who have all teamed up with the government to guarantee you three free credit checks a year. Here’s how to do it:

  • Visit, or
  • Call 1-877-322-8228, or
  • Complete the Annual Credit Report Request Form [LINK:] and mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.

Do not contact the three nationwide consumer reporting companies individually. They are providing free annual credit reports only through, 1-877-322-8228, and Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.

What Happens To Your Info (and How To Opt Out)
A credit report includes information on where you live, how you pay your bills, and whether you’ve been sued or arrested, or have filed for bankruptcy. Consumer reporting companies sell the info in your report to creditors, insurers, employers, and other businesses that use it to evaluate your applications for credit, insurance, employment, or renting a home. You can limit some of that sharing. Each year, your financial institutions should send you a privacy notice with instructions for “opting out.” Read these notices carefully. If you decide you want to opt out, follow the company’s instructions. If you choose to opt out, it can reduce unsolicited offers, but it also means you may not see offers that could interest you.

Building Good Credit
Make payments on time, all the time. That means living within a budget and keeping overspending under control. Once you have that down, here’s what you can do.

  • Apply for a secured credit card. By borrowing against your own money, creditors find this to be far less risky. BEWARE of credit card companies offering crazy-low rates at first, only to switch up to a higher interest rate later on when you’re deep in the hole.
  • Ask someone with a good credit history to co-sign on a loan or a credit card application. By co-signing, the person is agreeing to pay back the loan if you don’t.

So You Made Some Mistakes
It happens to lots of people, but there is always a way out. Sooner the better.

  • Budget: Sticking to a realistic budget allows you to pay off your debts and save for a rainy day. Be realistic about how much money you take in and how much money you spend. Listing your income sources. Then, list your “fixed” expenses, like mortgage payments or rent, car payments, and insurance premiums. Next, list the expenses that vary — like entertainment, recreation, and clothing. Writing down all your expenses, even those that seem insignificant, is a helpful way to track your spending patterns, identify necessary expenses, and prioritize the rest. Make sure you can keep the basics: housing, food, health care, insurance, and education. Public libraries, bookstores and computer programs have information about budgeting, money management, developing and maintaining a budget, balancing your checkbook, and creating plans to save money and pay down your debt.
  • Contact Creditors: Contact your creditors immediately if you’re having trouble making ends meet. Let them know that you’re having trouble. Some might be willing to work with you. Tell them why it’s difficult for you, and try to work out a modified payment plan that reduces your payments to a more manageable level. Don’t wait until your accounts have been turned over to a debt collector. At that point, your creditors have given up on you.
  • Credit counseling: Many universities, military bases, credit unions and housing authorities operate nonprofit financial counseling programs. Some charge a fee for their services. Creditors may be willing to accept reduced payments if you are working with a reputable program to create a debt repayment plan.


  • National Credit Union Administration
  • Equal Housing Opportunity

Content of this site is provided as information only and is not intended to serve as advice or representation whatsoever. Investigate these topics further by contacting appropriate advisers.

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