Inaccurate information can arise from errors in information supplied by a creditor or from a mistake made by a credit-reporting firm, or from fraud — i.e., someone uses your personal data to open a credit card account.
Additionally, knowing what's on your report and understanding how it impacts your credit score gives you the power to improve your number.
For instance, about a third of your score is based on how well you stay on top of your bills. Lenders like borrowers who have a good track record of paying on time.
"For people living paycheck to paycheck, that can be easier said than done," Gonzalez said. "If you're not, though, you can automate your payments. That saves you from paying late."
Another third or so of your score is derived from your credit utilization. That is, the percentage of your available credit that you're actively using. The lower that share, the better.
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"Anything over 40 percent is going to negatively impact your score," Gonzalez said.
Also important is how many years you already have been borrowing and repaying money. So if you're just starting out and need to build credit, you can see if someone in your life (i.e., Mom or Dad) will allow you to be listed as an authorized user on one of their credit card accounts.
Your credit also matters for reasons that go beyond interest rates: Some landlords and employers will check the credit reports of potential tenants or employees.
"If they're checking, and you have good credit and another person has bad credit, you're probably going to get that apartment or job over the other person," Gonzalez said.
You should check your credit report at least once a year, if not more, she said.
And no, checking will not hurt your score.