There are a great many documents that are important to our financial lives and our financial futures, but perhaps none are as important as our credit reports. The information contained in our credit reports can greatly impact the interest rates and loan terms when we take out a loan, or even whether we get that loan at all.

While those with sparkling credit reports can expect to obtain low interest rates when they need to take out a loan, those with less-than-perfect credit are often relegated to high-risk and, thus, high-interest loans. It can be a tough task to dig out from under a pile of debt with high interest rates, so ensuring accuracy in your credit report is extremely important.

So, how does one get one's hands on these all-important documents? Fortunately, it is easier than ever to keep tabs on your own credit report. It is indeed a fact that all consumers are entitled to receive a free copy of their credit report from all three major credit reporting agencies once per year.

Whether you choose to receive one credit report every four months or review all three credit reports at one time, this is an invaluable service for consumers, and definitely one to be taken advantage of.

Not that long ago, obtaining a copy of your credit report required forking over hard-earned money. In the past, consumers were only entitled to a free copy of a credit report if they had been recently turned down for a loan, credit card or other line of credit.

Now, once each year, you can request a free copy of your credit report at no cost, as guaranteed under the Fair Credit Reporting Act.

How to obtain free copies of your credit report

• Visit AnnualCreditReport.com.
• Request your free annual credit report either online, by phone or by mail.
• Online: The online option is the quickest and involves inputting your personal information and verifying your identity online. You will then gain immediate online access to your reports.
• Phone: The phone option requires you to go through a simple verification process over the phone. Your reports are then mailed to you, which will take approximately 2-3 weeks.
• Mail: The mail option requires you to download, print, complete and mail a form. As with the phone option, your reports are then mailed to you, which will take approximately 2-3 weeks.

If you choose the secure online option, you will instantly have access to your credit report after your identity has been verified. You can then print it, save it and review it at your leisure. Access to your three digit credit score is available through this site as well, although there is a small fee for that information.

See also: Introduction to credit scores

Act quickly if you discover errors

After you have reviewed your credit report, it is important to immediately report any errors that you uncover. Unfortunately it is all too common for credit reports to contain errors, so your credit report may not be completely accurate.

If you spot any issues, such as a closed or paid off account that still shows as active, or a new credit card account you did not authorize, be sure to report it to the credit agency immediately.

When reporting the error, it is important to provide as much documentation as you can. For instance, if you have a canceled check showing that an account was paid off, make a copy of it and submit it with your dispute. This documentation will help the credit reporting agency verify the information you provide and correct the problem more quickly.

If you spot any new accounts you did not authorize, or if you see a lot of inquiries on your credit report you did not authorize, be sure to notify the credit reporting agency. You want to have a fraud alert be placed on your account. These unauthorized accounts and inquiries could be evidence of attempted identity theft, and it is important to place such an alert on your account while the possible crime is being investigated.

It is up to every consumer to help keep his or her credit score and credit report as accurate and clean as possible. Having the ability to access credit reports each year at no cost makes that job a great deal easier.