Definition of an Annual Free Credit Report
The Fair Credit Reporting Act requires the three major credit bureaus, Equifax, Experian and TransUnion, provide all consumers with a free credit report annually.
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Function
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The AnnualCreditReport.com website is the only website that is authorized by the Federal Trade Commission to order your free annual credit report from. A link to this website is provided in the Resources section.
Time Frame
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You are entitled to a free credit report once every 12 month period, not every calendar year. For example, if you request your free credit report in May 2009, you will not be eligible for another report until May 2010, not January 2010.
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Significance
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Knowing what your credit report contains allows you to have a better idea of what lenders will see when they pull your credit score when you apply for loans or credit cards. You can also see if there are any errors in your report that you need to have corrected.
Considerations
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You can choose to request your free credit report from each of the three credit bureaus at the same time, or you can space them out throughout the year so you can better monitor any changes to your credit history.
Misconceptions
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Your free credit report does not include your credit score. However, your credit score is based on the information found in your credit report so you can usually get a good idea of the health of your credit score based on your credit report.
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