Should I Monitor My Credit?
In central Pennsylvania, a couple was caught opening credit card accounts and accessing a family member's bank account after robbing them of several thousand dollars. This story, with its many variations, is repeated daily all across the country. In fact, the Federal Trade Commission's Consumer Sentinel Network (CSN) received over 2 million complaints about identity theft in 2012 alone!
Why is ID theft growing so much? It's simple; if a person can steal your Social Security number, they can access your bank account and other personal information and use this information to open credit accounts, steal your tax refund and much more. However, taking precautions, such as keeping a close eye on your financial information, can keep your accounts safe and stop potential identity theft before all your money and credit is gone.
A good resource for keeping an eye on your credit is right here, where you can find free credit monitoring!
What Is Credit Monitoring?
Credit monitoring is the process of reviewing your credit report for activities that could indicate credit fraud, identity theft or mistakes that could hurt your credit score. Daily monitoring of your information that is reported to the big three credit bureaus (Equifax, Experian and Transunion) helps you see when your information is accessed changed or new information comes is created.
What Information You'll See
Most credit monitoring services will alert you whenever the following types of information are updated.
Public Record Changes
Your public record is a legal document issued by the county, state or federal government. The most common information in your record includes birth and death certificates, marriage licenses, divorce decrees, deeds, mortgages and other property records, as well as any professional licenses you hold, driving records, criminal records, court records, unclaimed property and several other records. However, only your financial information, such as bankruptcies, liens, judgments, child support and wage garnishments is included on your credit report.
What to look out for: Watch for any changes. These are legal records; there should be no changes that happen without your knowledge.
Your credit report shows employment information that you've submitted on previous credit applications. This information is only as detailed and accurate as you've provided, and is only updated when a new credit application is submitted. Your employer does not provide the credit bureaus with your personal information.
What to look out for: Watch for employers that you have never worked for. If the name and address of an employer change, or other details change, notify the reporting agency right away.
Involuntary credit inquiries happen when a company checks your credit to make you an unsolicited credit offer. These inquires do not affect your credit score, and there is little you can do to prevent them. However, voluntary inquires indicate that you gave a lender permission to access your records and usually indicate that you applied for credit.
What to look out for: Voluntary inquires that you did not authorize indicate that someone is trying to open credit accounts with your information. These need to be reported right away.
New Account Updates
This includes your name, address, account type, account number, date opened, balance, and status of your newest financial accounts.
What to look out for: Account changes, including balance decreases or increases, address changes or any other changes that you did not authorize to make.
This information shows the times that a creditor has sent your account to an outside company to collect debt. Your credit report will show when the account was sent to collection, the amount owed, the collection company and other important details.
What to look out for: If you are currently in collections, watch for activity that you did not make, including payments made, new accounts added or other activity that you're not aware of. If you receive a call from someone claiming to be a collection agency and your accounts are all up to date, do not provide the caller with any information.
How Can It Help Me?
One of the main benefits of having a credit monitoring service is the time and effort you save while monitoring your accounts. Without several extra hours a day, watching all your account activity can be a daunting challenge, especially if you are busy. Furthermore, while you can monitor your existing accounts, it is nearly impossible to monitor credit inquiries and other changes to your credit report.
Another key benefit is the peace of mind you'll have knowing that even when you're busier than ever, your personal information is being looked after. If an identity thief comes stalking you, you can take action before it's too late.
What Happens If My Identify Is Stolen?
If you don't actively monitor your credit, you may not notice that your identity is stolen until you state seeing strange charges on your bills. If your ID is stolen and used to open new accounts, take the following steps immediately:
- Notify the creditors of the new accounts. Have the charges taken-off and close the account(s) right away.
- Notify the credit bureaus and have them place a 90-day fraud alert on your account. This means that additional information is collected to verify your identity when you apply for credit; no one else except you will be able to open an account.
- Contact all your existing financial institutions and make sure your accounts are secure.
- File a police report. Although there is not a lot police departments can do, by reporting a crime and keeping your police report, you can make it easier to correct your credit report.
- Contact the Federal Trade Commission. While they do not investigate individual cases, reporting to them can make it easier for law enforcement agencies to track and hopefully catch identity thieves.