Here is some food for thought: you’re planning to renovate your home or take out a loan to pay for a new car. You’ve done extensive research on what you want and, in the case of a home improvement project, you’ve chosen the contractor, drawn up plans, and priced those new kitchen cabinets and counter tops you want.

One thing remains undone, an important step that could scuttle your dreams: your credit could be trashed, thanks to the work of an identity thief or because of a mistake made by the credit bureau. Yes, you’ve done your homework but you forgot one key step: checking your credit reports to see if they are accurate and reflect current information.

Your credit report is a vital part of consumer lending and, thanks to an act of Congress, is free when ordered through Annual Credit Report, a website managed by the three primary credit reporting agencies, Experian, Expedia, and TransUnion. Once annually, you can get one copy each from the three agencies of your credit report for free and optionally pay the $4-8 fee to get your credit score. Yes, pay the money for your credit score because that is the number creditors use to determine if you qualify for a loan and at what rate.

Checking your credit reports regularly makes sense, but what about other services which keep tabs on you? Though credit reporting bureaus are the most important way to get “the goods” on you, there are some other organizations who keep tabs on you, namely:

Insurance — Your medical history or your homeowner’s policy could be information that insurers want. Several companies keep tabs on this stuff including MIB and Choice Trust.

Tenancy – If you’ve rented before and left your landlord high and dry, don’t think for a moment that this decision won’t come back to haunt you. SafeRent and ChoicePoint know what you did and they’re more than willing to share this information with a landlord, for a fee of course.

Job — Acxiom and ChoicePoint keep tabs of your employment history, but you could be aiding them with your online resume through Monster or CareerBuilder.

Banking — Have you written a hot check lately? Probably not, but opening up a checking account is serious business. That’s why TeleCheck, ChexSystems, and SCAN keep track of good and bad deposit information.

If a problem does come up,  the credit reporting bureau or other credit checker must allow you to address the mistake or correct a problem. Most of the companies I’ve mentioned will provide that information to you for free, but you have to ask in order to get it.

Don’t wait until after you set your home improvement or other consumer project in motion before checking your credit reports. To delay means you’ll really pay, but certainly not in a good way!

Tags: banking, credit history, credit score, employment, free credit report, insurance, tenancy

Several banks in my area have launched marketing campaigns touting their “free checking” accounts for new customers. Wooing new business is big business and financial institutions are battling community banks, credit unions, and online institutions for consumer money.

Free checking isn’t always what they say it is, with various strings attached to force you to do banking their way. Let’s take a look at some of the schemes out there and what you should look for when reading the small print:

Free Checking For A Year — One of the better offers available, you can get free checking with a bank for the first year. In some cases you may have to keep a minimum amount of money in the account or deposit $100 to get the free checking. Not a bad option, but remember: come the thirteenth month you can expect to pay an average of $12 monthly for an account that is no longer free.

Free Checking With Savings — You can get free checking all right, but the bank also requires you to open up a savings account and keep at least $1000 in it at all times. They’ll pay you interest on your account, usually a paltry .5%, which is well below the 3% ING Direct pays its customers for savings. Still, you’ll only get $25 extra in interest by depositing your money with ING, but you’ll be able to save $144 in checking account fees with this deal.

Free Checking With Mortgage – If you already have a mortgage at a particular bank, you may be eligible for free checking there as well. This is a good deal if the mortgage rate you received is a good one, otherwise you might do better looking for a new mortgage which could save you hundreds even thousands of dollars annually.

Checking With Interest — This is one of the worst ways for consumers to keep their money in a bank. Usually, in exchange for free checking, you’ll be required to open up a “super checking” account and maintain it with at least $1500 at all times in order to avoid a monthly fee. You’ll also be given interest, usually a paltry .25-.30 % on the balance which is $3.75 interest for the year.

Hidden Fees and Then Some — With most any checking account, there can be numerous fees which are usually hidden. Sure, you may get a little booklet explaining what these fees are, but who reads them? Besides, they’re frequently updated making it difficult to track the changes. Hidden fees include: ATM fees for using your debit card at other banks, overdraft costs, a per check charge for writing out a check, online banking fees, transfer fees, canceled check return fee, and check printing charges.

Rarely does a bank offer absolutely no strings attached free checking. Some banks offer excellent plans for seniors while others offer free checking to everyone else as long as you have at least one other deposit account or loan that is open and active.

Tags: banking, banks, checking, direct deposit