Yes, you can get one free copy of your credit report every year from each of the big three credit-reporting agencies: Equifax, Experian and TransUnion.

But you can't go do that through their Web sites. (They'll charge you.)

You must use AnnualCreditReport.com.

The credit bureaus created it to comply with the Fair and Accurate Credit Transactions Act, a federal law that requires them to provide free credit reports to anyone who asks.

You can get the reports online immediately. You can also print out forms to mail in or call 1-877-FACTACT (1-877-322-8228) to request copies of your credit reports. If you do order by mail or by phone, however, expect to wait more than two weeks for delivery.

Even though each of the national credit reporting agencies is a separate company, their reports tend to be similar since they're reporting basically the same information: how much you owe and how well you pay your bills.

Other heavily publicized Web sites also claim to offer free credit reports -- freecreditreport.com is the most obvious and misleading example. But when you read the fine print, you see that you can only get a "free" credit report when you agree to buy one or more of their services.

The information on your credit report is important because it's what a lender will consider before giving you a mortgage, credit card or any other loan. It is also used to determine what interest rate you will pay for that loan.

You need to see that because some of the information could be wrong.

Like the neighborhood gossip, credit-reporting agencies simply report what they are told -- or what they think they are told -- by banks, credit cards, hospitals, power companies and other creditors.

They receive millions of pieces of financial information every day that have to be added to millions of credit reports, and they don't check any of it for accuracy. They simply try to figure out whose credit report each bit of data should go to and add it there.

Sometime they get it right. Sometimes they don't.

To their credit, they acknowledge that your report could have mistakes in it. That is why each report has very clear instructions on what you need to do to correct a mistake, challenge a claim by a creditor, or at least explain what happened.

When you file a challenge, the credit-reporting agency will actually go to the source of the information and ask for their version.

You can also have your credit report include a short note from you explaining things.

What sorts of things? Maybe you were out of work for several months and you got behind on your payments, but you are working now and clearing things up. Maybe there was a sickness in the family that caused financial problems, but that crisis has passed and you are in the process of catching up on your bills. Or, maybe you're the victim of identity theft.

If you have serious problems with inaccurate information or identity theft and need to check your credit reports more than once a year, Equifax, Experian and TransUnion sell unlimited access for $10 to $15 a month.

There are also plans that will give you your credit score, which is the grade you get on your credit history. The higher the score, the better your credit and the less you'll pay in interest on any loan.

Just make sure you get your FICO score. It rates your credit worthiness on a scale of 300 to 850 using a formula developed by Fair Isaac Corp. and is used by virtually every lender.

Fair Isaac provides a credit history from any of the three major credit-reporting agencies, and your FICO score based on that report, when you order the FICO Standard package for $15.95.

Equifax will also sell you your credit history and FICO score through its Score Power package for $15.95.

A free but less precise alternative is to get an estimate of your FICO score by answering some questions about your credit at the Fair Isaac Web site.

Don't go to Experian and TransUnion for your credit score.

They sell consumers a VantageScore, which is calculated using a new system Experian, TransUnion and Equifax created to compete with FICO.

Vantage rates your credit on a scale of 501 to 990, so its results are almost always higher than FICO scores, but that doesn't mean your credit is better and we donâ??t know any major lenders who use it.

There are other websites that claim to offer the same thing, but when you read the fine print, you will see that you get it "free" only when you agree to buy one or more of their services.

By the editors of Interest.com

Have a question about your finances? Ask us at editors@interest.com