A recent amendment to the federal Fair Credit Reporting Act (FCRA) obligates the three nationwide consumer credit reporting companies - Equifax, Experian and Trans Union - to provide a free credit report to any consumer who requests it.

The importance of a credit report cannot be ignored. An accurate report can help you obtain loans for major purchases, or even help you rent an apartment. All this, and more, becomes difficult if you have negative errors in your report.

A negative report can prove to be an obstacle if you are job hunting. This is because most employers will go through your credit history before offering employment. If you are actually employed, then a negative report can reduce your chances for further promotion. And, what if the end of it you realize that these errors were because of no fault of yours and that they could have been sorted out in the first place. You can avoid this situation by ordering a free credit report.

Once you get it, make sure the information provided in it is correct. This means that you must verify that your personal details such as your name, address, date of birth, and also the name of your current employer are correct. When this is done, do a check on your financial status. This is because your report will also contain information of your bank accounts, loans, credit payments. In other words, your credit card is also in a way your financial statement on which your future transactions will depend.

If you find any discrepancies, file a report in writing, with any one of the consumer reporting companies, for action. Apart from providing you with the opportunity to verify your accounts and check your credit score, these reports also provide a listing of the companies who have made enquiries on your reports.

These consumer reporting companies sell this information to bankers, creditors, insurers, employers and other business houses. It is imperative to order a free copy to ensure that there are no inaccuracies or errors in your report.