Clearer Disclosures for “Free Credit Reports” Take Effect Friday

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New disclosures required by the FTC must be included in "free credit report" ads beginning Friday, aiming to clear up any confusion about where you can actually get a free credit report.

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The Federal Trade Commission’s amendment to the Free Credit Reports Rule takes effect this Friday. This requires much clearer disclosures in ads for “free credit reports.”

This provision is needed because consumers have been confused and misled about where to get a free credit report.

The federally mandated free credit reports are available only at, but many other websites advertise free credit reports. Beginning Friday, any other website that advertises free credit reports must have a disclosure at the top of every page that tells consumers how to get these free credit reports. The statement must say:

“This notice is required by law. Read more at FTC.GOV. You have the right to a free credit report from or 877-322-8228, the only authorized source under federal law.”

The amended Rule takes effect for print and Internet ads on April 2. The wording of the disclosures for television and radio advertisements will take effect on September 1.

The FTC amendment is needed because some credit reporting agencies and other companies have taken advantage of the awareness of “free credit reports.” They advertise free credit reports to lure in consumers and then sell products and services like credit scores and credit monitoring. This has created confusion for consumers who are only looking to receive their credit score at no cost.

On Google, all of the advertised listings for the term “free credit report” are for companies that charge for these additional services. Some of the top organic listings for this keyword lead the consumer to According to SmartMoney, Experian, the credit report agency that owns, spent $70.7 million in 2007 and $19 million in just the third quarter of 2008, an increase of 28% over the same period in 2007. A vast majority of that money, roughly $14 million, was spent on television ads.

Adding to the confusion, the law requires credit bureaus to provide a free credit report to consumers, but this does not include your credit score. Some credit bureaus try to sell credit score or credit monitoring services as you order your free credit report. These promotions have led some consumers to believe they must purchase these products to get the credit reports.

Other websites claim to offer “free credit reports,” “free credit scores,” or “free credit monitoring” but these are not part of the legally mandated free annual credit report program. “Free” is usually temporary because it means free trial. If you forget to cancel during the trial period, you will automatically roll over to the pay service and the company will start charging fees to your credit card. This could be as much as $14.95 to $29.99 a month.

At, the trial period is seven days after you order your free credit score. If you don’t cancel the membership during the trial, then you are enrolled in their credit monitoring program. Membership costs $22.95 per month. You may cancel at anytime but you may not be eligible for a refund for your membership fees.

The new rule also requires that consumer reporting agencies cannot advertise products and services on until after consumers receive their free annual file disclosures. It restricts other practices that may interfere with the free disclosure process.

The Fair Credit Reporting Act guarantees you access to your credit report for free from each of the three nationwide credit reporting companies (Experian, Equifax, and TransUnion) every 12 months. You can request your free report online (, by phone (1-877-322-8228) or by mail (P.O. Box 105281, Atlanta, GA 30348-5281). You can request all three reports at once or one at a time.

“Every consumer should take advantage of these free credit reports. It helps you to know what your creditors see about you and to uncover any suspicious activity. If there are mistakes, you can straighten them out,” says Bill Hardekopf, CEO of and author of The Credit Card Guidebook. “It’s a good idea to stagger the free report you are entitled to from each of the three agencies every four months so you can monitor your credit throughout the year.”

If you have paid for what you thought was a free credit report, you can file a complaint:

The statement from the Federal Trade Commission can be found here:

Stacy Johnson

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