I know, I know. The title is a bit, shall we say, amgibuous (and that’s being generous). The point is that not all “free credit reports” are created equally. The ads you see on TV and online for free credit reports usually come with strings attached: costly monthly credit monitoring service.

Credit monitoring basically keeps an eye out, in your behalf, of any new blips on your credit report that transpire from month-to-month. These blips could range from new credit inquiries to new reported late payments and collections/judgements. All can have a negative impact on your options when it comes time to purchase a new home or refinance your existing mortgage.

Is credit monitoring a valuable service, and worth the monthly fee? I suppose that is up to the individual, but it is definitely something to be aware of when ordering a “free” credit report (just read the fine print - as always).

The Real “Free” Credit Report

Now then, there is a way to get a truly free credit report with no strings attached each and every year. Here’s a link to the FTC’s website with more information.

The Fair Credit Reporting Act (FCRA) requires each of the nationwide consumer reporting companies – Equifax, Experian, and TransUnion – to provide you with a free copy of your credit report, at your request, once every 12 months. The FCRA promotes the accuracy and privacy of information in the files of the nation’s consumer reporting companies. The Federal Trade Commission (FTC), the nation’s consumer protection agency, enforces the FCRA with respect to consumer reporting companies.

A credit report includes information on where you live, how you pay your bills, and whether you’ve been sued, arrested, or filed for bankruptcy. Nationwide consumer reporting companies sell the information 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.

Hat tip to Todd

Rates have recently jumped up some, reaching their highest levels in the past several years.  With many people having ARMs (adjustable-rate mortgages), there are many with good reason to refinance into a fixed rate program or something similar before rate adjustments take place.

Typically, an ARM will adjust by 1% maximum in a single year, with a 6% adjustment cap on the life of the loan, however ARMs vary greatly so if you have an ARM you’ll want to look at the details of your particular mortgage.

On a positive note, rates are still relatively low (mid 6 range to high 6 APR for conforming 30 yr fixed) compared to oh, the 1980’s when rates were in the teens and even twenties.