Free’ credit reports often have strings attached

By By Jane Stringham

By Jane Stringham

Students at the U making their first forays into the world of credit — whether it be applying for student loans or buying a car — need access to credit reports at some point in their financial lives.

These young consumers have at their disposal a multitude of online sources, which offer reports with the appealing prefix “free.”

This is in keeping with 2003’s Fair and Accurate Credit Transactions Act, which states that all consumers are entitled to three free credit reports every year. The websites seem to simply provide an avenue through which to obtain the free reports, but recently published research conducted by U professor Robert Mayer says otherwise.

Mayer, a family and consumer studies professor, began research last December investigating the credibility of 24 different websites’ free credit report services.

A seven-page questionnaire developed by Mayer and Tyler Barrick, a graduate student in the department, evaluated each site. In the analysis, the two paid particular attention to the websites’ use of the word “free.” The sites used the word an average of 13 times each, which Mayer deems “incredible.”

Why so incredible?

Many of them aren’t really free.

“One main point of the report is websites other than annualcreditreport.com are not truly free,” Barrick said. “Many of the sites cause confusion by being very similar to annualcreditreport.com.”

Similar site names and vague descriptions of services and pricing are ways in which the sites confuse customers.

Mayer explains that sites try to “needlessly” sell you credit reports by packaging them differently. Packages including credit monitoring, credit scores and credit reports are common.

While the report addresses 24 sites, most are owned by or have close connections to two major Credit Report Bureaus: Experian and Transunion.

“In any marketplace, the existence of only two companies is never good,” Mayer said.

He also points out that these are the same companies ordered by law to provide all consumers with free access to their credit reports, and said “they are undermining this government-given right.”

The Consumer’s Union published Mayer’s report online on July 5. The union also publishes Consumer Reports magazine and sponsors Consumer Reports Webwatch.

Mayer currently serves on the board of the latter, and his report can be found at consumerwebwatch.org.

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