When is a good time to check your credit report?
Now!! Specifically, here are my suggestions:
1) Prior to end of the year holiday shopping. This not only helps you with your budget, but also your ‘balance to limit’, which you want to stay at 30% or lower. Doing so also places you in the position to decide if you want to open that new card because the department store is giving an additional 25% off. Is it really worth it?
2) At the beginning of the year. There is no better time to make the new year your best year. The start of a new year is a perfect time to evaluate your credit and credit score. Often times we make resolutions to eat better, lose weight, save more money, etc. Your credit score should be tied to your financial goals, whether you have ever thought of it in that way or not. At this time you will be able to see your balances all in one place and create a plan to pay down or payoff those credit cards (TIP: do not close those paid off credit cards).
3) When you start saving for your new home purchase. Typically, when people get serious about buying a home, they start saving for a down payment and researching the homes in the area they would like to live. Your purchase may be 3-9 months away or more. This is the time to review your credit, not once you put in your application for a mortgage. Knowing where you stand prior to the application process gives you the opportunity to potentially raise your credit score and address any negative items that may be dragging down your score. Every mortgage company or bank will insist that you payoff or ‘clear up’ negative items on your report. With a purchase as large as a home, every percentage point saves or costs you money. Raising your score just 20 points, for example, can place you in a better financial position. You want to enter the buying process with as much wind at your back as possible or with what I call Credit Swagger.
I suggest using your calendar to mark the times when you want to check your credit report and credit score. I give my clients periodic reminders to evaluate the progress they have made throughout the year. Remember at www.annualcreditreport.com you are allowed to receive your credit report once every 12 months from the 3 major credit bureaus. This twelve month timeframe is rolling. Meaning, it’s not based on the calendar year but the time you actually receive your report. If you requested your report in February of last year from Equifax, then you can receive another in February of this year. Personally, I check one at the beginning of the year, one in April (my birthday month) and the other in November (before Black Friday). In addition, I utilize www.creditkarma.com to check my report as often as I like. Doing this should eliminate any surprises. You also become your very own fraud protection by checking this often. Now I realize not everyone is going to check their credit as much as I do, but it’s a good habit to develop. It’s time to be proud of your score, set some goals for increase and take advantage of all a good credit score has to offer.
Stay tuned, come back…for more great reads, tips and insight into how to increase your score and how the credit reporting system works. Question: What are you going to do right now? Answer: CHECK YOUR CREDIT REPORT!