With so many people working to recover from the recession and restore their good financial reputation, credit reports are being ordered more often. Along with that, more commercials promise consumers free credit reports that in actuality are not free at all. The FTC is working to make sure people are no longer being misled by the lure of ‘free’ when it comes to their credit.

Annually, consumers are entitled to one free credit report. This free report does not include a credit score but does allow consumers to review their credit histories, correct mistakes and misinformation, and overall keep tabs on their financial situation. Because people are working harder to beef up their good credit, companies are taking advantage of the opportunity by advertising free credit reports in exchange for becoming a member of a credit monitoring service. This monitoring service generally charges a fee each month, which many times is automatically deducted from a credit card account. Consumers just looking to receive a free copy of their annual credit report are often mislead and not fully understand the consequences of their signing up for membership.

The FTC is taking steps to clarify when free doesn’t really mean free. A new disclosure will be required on print advertising of credit monitoring services beginning April 1st. Starting in September, the disclosure will be also be displayed on television and radio advertisements. This notice states:

‘THIS NOTICE IS REQUIRED BY LAW. Read more at FTC.GOV. You have the right to a free credit report from AnnualCreditReport.com or 877-322-8228, the ONLY authorized source under federal law.’

There have also been reports of visitors going to AnnualCreditReport.com and being automatically re-directed to a paid website that offers credit monitoring services. This action likely was the result of visitors clicking paid advertisements which will no longer be displayed on the site until after consumers have ordered their free credit reports.

Consumers who have not regularly been checking their credit histories are encouraged to do so because many financial decisions are based on histories and credit scores. Lenders, insurance company, landlords, and even potential employers may access your credit report to base decisions and interest rates on how you rank financially. By requesting a free report, you can stay on top of your information and know where you stand. After receiving the free copy of a report, subsequent reports will cost a flat-fee. No one is required to sign up for credit monitoring services unless they choose to do so.