If you think your financial house is in order, but you haven’t bothered to get your credit report in the last few years, then you’re lying to yourself. You’re being irresponsible and playing a dangerous game of chance. This is true whether you’re a Canadian or an American.
If you’ve never bothered to get your credit report, don’t worry. Actually, keep worrying. You can stop worrying after you rectify the situation. You need to get a credit report from each of Canada’s credit reporting agencies (Equifax and TransUnion). For Americans, there’s a third credit reporting agency called Experian.
If you get your credit reports and review them on an annual basis, you can:
- reduce the chances that your identity will be stolen or the impact in the event that it is
- correct errors that may adversely impact your credit score and credit worthiness
- mitigate the chances of legitimate mistakes, like a creditor trying to seize your assets because you share the same name as somebody else
Checking your credit report isn’t a fool proof way to prevent any of these problems. But it’s a proactive starting point and, if you find an error, you can initiate the process to correct it.
Here’s why you shouldn’t procrastinate about getting your report: it’s easy and cheap. Actually, it can be even better than cheap: this article provides instructions on how to get your credit reports for free.
By the way, this article is actually a “Step to Personal Finance Success”. I’m just not explicitly numbering them at this point. When I’ve generated enough “Steps” to form a useful list, I think I’ll compile a free eBook. I really need to write about the vital importance of disability insurance (and the futility of critical illness insurance). I also need to heavily revise Step Two, which was about term life insurance, to reflect the input of Glenn Cooke.
Alright, so I’ve convinced you. You’re going to get your free credit reports. You’d rather not pay for the privilege of reviewing your own information.
In America, it’s easy. You can get your credit report from any or all of the three agencies once a year, just go to this website. Not only can you order it online, but you can typically view it online! American readers: you can skip the rest of this article. Congrats on winning the lottery of citizenship.
But in Canuckistan, we drink milk from bags. We also let foxes write the legislation that protects hen-houses. So our consumer rights are relatively pathetic. Here’s how you can get your free report from each of Canada’s two agencies:
TransUnion
You can request your free copy once a year:
I highly recommend TransUnion’s automated phone system for getting your free credit report. It’s very easy — so long as you can answer multiple choice questions about your banking and credit card details to verify your identity (pro-tip: make sure you have your wallet with all of your cards in front of you when you call). I think that you also need to be living at the most recent address they have on your record. It took me under ten minutes and I got my consumer disclosure in the mail just a week later.
Equifax
The process for Equifax is relatively onerous. I’d argue it’s so prohibitively challenging that it’s not in the spirit of the relevant disclosure law (PIPEDA). But, then again, I’m actually made of cups.
You need to fill out this simple one-page form and mail it in. Easy. Except for Equifax’s ridiculous verification requirements (and yes, they present the requirements not in a list but in blobby text):
“You must provide [photo]copies of 2 pieces of government-issued identification (such as a driver’s license, health card, birth certificate or passport). If neither piece of government-issued identification shows your current home address, you must also submit a copy of an additional document that shows your address (such as a recent telephone or utilities bill, or a bank or credit card statement). You may black out transaction details on a bill or statement, as long the copy clearly shows the date of the document, the sender, your name and address, and your account number.”
Sadly, when you get your free credit report from Equifax or TransUnion, it won’t include a credit score. In Canada, there’s no free method for checking your credit score, whether you’re an individual or a business — at least not that I’m aware of (please do share any!). Luckily, you probably don’t need your credit score unless you’re looking to borrow money. The only good reason to borrow money is a mortgage. In Canada’s housing bubble you shouldn’t be looking to fasten that noose around your neck anyway.
If you still insist on finding out your credit score, I recommend Equifax. Why? Based on my experience in the banking industry, the Equifax score really is the market standard for individuals. While I worked for one institution that pulled from TransUnion, it was definitely in the minority. Your Equifax and TransUnion scores are probably different, so pick the most useful one.
The reason you should take the time and trouble to pull your free credit reports today was summed up by Ben Franklin a quarter millennium ago (a hundred years before the first consumer credit reporter came into existence):
“An ounce of prevention is worth a pound of cure.”
In America, we get an extra free credit report if someone denies us for credit. Last year, I managed to get FOUR free credit reports
They really need to figure out a less lame way to do that in Canada.
That’s awesome.
What we really need is REAL consumer protection laws. http://www.moneyville.ca/article/1276180–air-canada-vacations-off-hook-for-hotel-woes — this couple paid $3k for a vacation, didn’t get the promised room, and got offered a squalorous room instead. They said “no” had to fly home (paid an extra $900 for that). Air Canada Vacations said it was the resort’s fault and that a tour operator (who takes thousands of dollars in exchange for MANAGING your tour) has no responsibility. Who’s able to sue a Cuban business? So they sued Air Canada and won in small claims. Then they lost on appeal and need to pay AC’s $10k legal costs. What a joke banana republic we live in, manipulated by corporations. This Kafka garbage wouldn’t stand in America, because they know how to confront tyranny. They start by NOT allowing travel to Cuba.
The negative publicity Air Canada is getting from this case will cost them a lot more than the refund. Stupid. If even 10 people read the article and decided against using Air Canada Vacations, the refund probably is offset. If 1000 people did, or 10,000…what a bonehead move.
Exactly. It honestly strikes me as elder abuse. That a tour operator would accept $3k from senior citizens, let them go to Cuba for what the judge admitted was not only discomfort but “abuse”, is awful but mistakes happen. But the fact they weren’t put on the next plane and reimbursed for at least the COST of their trip is outrageous. And then for AC to appeal on the argument that they shouldn’t owe a duty of care to vacationers?!? It’s honestly the worst consumer story that I’ve heard this year. Air Canada abuses old people which, in my books, is a lot worse than breaking guitars. I’m flying Westjet to Edmonton for Xmas or driving. Not flying with a company that thinks it doesn’t owe a “duty of care” to its customers.
This is something I have to do. I’ve got a fraud warning on my credit reports since someone got a hold of enough of my personal information to cause some real problems. I periodically get calls to confirm that I really have applied for such and such a credit card. Usually it’s a fraudster, though I do get the odd new card.
Yes, you are a perfect situation where it’s extremely valuable to check your reports once a year. I can’t understate how simple it can be to get your TransUnion report, literally less than 10 minutes if you know your info. The Equifax one takes longer but, again, it helps. The key is to make sure the company eliminates any “injected” information (e.g. a new address) that the fraudsters could subsequently use to hijack your identity. It’s very difficult to steal an identity in one step; it usually happens over time and people just don’t notice it.
I’m pretty proud of myself since I did once pull both my Equifax and TransUnion reports. I think it may have been around the time I legally changed my name (after getting married) – which, for the record, is a total hassle. Anyway, my husband probably should do this too, since we discovered (around the time that we got a mortgage together) that his credit reports were all screwed up. He has a twin sister whose first name starts with the same initial as his and is very very similar to my husband’s name (don’t ask). Same last name. Obviously, same birth date. Half of her credit history showed up on his report, which had a serious impact on his creditworthiness. Fun times!
OK next time we chat on Gmail, you have to let me guess her name lol I can think of like 8 hilarious possibilities off the top of my head.
That’s a Franken-credit report horror. Perfect example because it underscores the importance of staying on top of/checking your credit. This wouldn’t be a necessity if it was all done by computers. But there are humans involved and people are pretty dumb. Don’t rely on human stupidity to protect your credit history. You are your own best advocate.
Franken-credit report, eh? I had that problem too. Equifax had two files for me, one was “Gene”, the other “Eugene”. So, fraudsters were still able to sneak one credit card through. I had it cancelled quickly, so I don’t know if the bank lost much money on that one.
It’s a strange situation, where the consumer is somehow responsible for the accuracy of the report, yet they’re so reluctant to send us the information unless we pay them money.
Thank you for this post….great advice!
I can personally vouch for and highly recommend getting hold of your personal credit report from TransUnion and Equifax. The best way is either by fillng in the form provided in this blog OR you can simply write to them, provide photocopied ID (check their websites which will provide direction on what type of ID OR telephone their 1-800 lines for the same information). Send your written request in and you will receive your personal credit report for free. Don’t believe the stuff you see about having to pay for it. That’s not necessary. And yes, Equifax is onerous – I’ve had to go through a series of written communications with them recently which not only demonstrated a potential level of incompetence, but also that they were simply wasting my time rather than providing me with the information I’d requested (which in this case was a little bit more than my personal credit report). Once I told them they’d been given the information they’d asked for and to stop wasting my time, they answered my question.
Hi Joe,
In Canada we do get free credit reports! It’s not as well known and in the open like in the States, but Canadians are allowed to get a free report as many times as they wish. The more difficult part is finding out how to get it. A free credit report here is usually referred to as a credit disclosure or a consumer disclosure. Yeh, I know, why not just call it free credit report. So much easier!
I’ve been working in this industry for years and even up to today (2013) I run into people who have never heard or seen their own credit report!!!
Cheers,
Pat
Yeah so, um, did you actually read the post before dropping your deuce of a self-promotional comment? Or was it an “SEO” specialist?