It's the end of the year and it's time to get your finances in order. Make sure all those accounts and loans and such are shipshape so you're not trying to explain things to a tax preparer while they look at you like a German Shepherd trying to understand calculus.

And that brings me to a great freebie. And it's a legit freebie.

It's http://www.annualcreditreport.com/

You see, a buncha years ago the US gubment got involved when people found that it was quite difficult, if not impossible, to find out your own credit information that's provided to loan officers and mortgage banks. So they made a law that credit reporting agencies have to provide you with 102% free information about you at least once a year.

And if you watch the TV commercials, you know there are plenty of websites and/or 800-numbers that are happy to fetch those reports for you. Problem is, those companies are only "free" in the way that that timeshare company is giving you a "free" vacation. That is to say that you'll be asked for your credit card number for "verification", and you'll find yourself signed up to something you didn't want and that'll cost you a lot of money.

Fact is, you can get your reports without signing up to anything or paying a dime. Ever. It's the law. The government contracted the creation of the site I mentioned above. It's quite simple. You just enter your personal information (NOT your credit card number), then the site will navigate you through the three credit companies websites where you'll be able to see all your credit information. It's all shown instantly, and the entire process takes about 15 minutes, which is quite a change from ten years ago when you had to call the companies individually and wait for a paper report to appear in your mailbox.

Mind you, each company will try to sell you a look at your "credit score" for about eight bucks. You don't need this, so just refuse it. Your "credit score" is just your credit information run through a proprietary algorithm which normalizes your credit to a scale from 0-1000. You see, loan officers and car dealers thought it was a big hassle having to sift through five pages of information on you, and nobody liked having to make the decision as to how many late payments constitutes "bad credit", so now they pay eight bucks to have somebody else do the sifting. If your "credit score" is above a certain threshold, then you have "good credit" and can get the best interest rate. If not, you get a worse deal.

While commercials will tell you that it's ABSOLUTELY VITAL that you know this number, it's not that important. What's important is the full report, because sometimes it isn't correct.

For example, a dozen years ago, Best Buy changed whatever bank they used to finance their computers, and the previous bank just closed up and never bothered to tell the credit companies that the accounts were closed. So when I looked at my credit last year, it showed an "open" credit account with Best Buy for a computer I financed long ago. And while the account showed a balance of zero, since the account was "open", the $2000 credit limit still counted against the amount I was allowed to finance.

So I made a couple of calls and got it taken care of. It never would've occurred to me that that long-closed account might still be thought to be open, but the credit people thought it was.



So anyway, do yourself a favor and check your credit. It's free once per year, there are no strings attached, and it's a good way to make sure that your actual credit situation is what you think it is.



Oh, and if you think you might need protection against identity theft, check with those credit companies before you sign up for some dodgy "credit monitoring". We had some guy in Kansas buy a cellphone in our name a couple of years ago, and the credit companies were more than happy to set our account to refuse any credit checks without our phoned-in permission. And that was free.