Introduction: Understanding Credit Monitoring Services
How Do Credit Monitoring Services Work?
Credit monitoring is a service that tracks people's credit reports, looking for any questionable or fraudulent activity on and offline. Credit monitoring companies will generally alert the subscriber to the action immediately if any unusual account activity is detected. This includes suspicious charges to credit cards, newly opened lines of credit such as auto loans or mortgage applications. Fraud alerts are generally sent through text messages, emails or phone calls, and they're usually sent within 24 hours, if not immediately. In the event the account action is proven to be unauthorized, most credit monitoring services will work with their customers to put a freeze their credit and help remove the information caused by the fraudulent activity.
Why Do You Need Credit Monitoring?
1. Credit Monitoring Helps Stop Identity Thieves Fast
With the right information, it's relatively easy for an id thief to open a new account without prior authorization and begin to rack up thousands of dollars in fraudulent charges or even worse, use their social security card to commit insurance, tax and other types of fraud. The amount of damage that an identity thief can do in one year is staggering. It could take a victim 5 years to recover from what an id thief can do in just months. The best credit monitoring services on the market help stop the theft before it gets out of control. At the first sign of suspicious activity, alerts are sent so you can take immediate action and stop the fraud before it gets worse.
2. Credit Scores are Protected by Credit Monitoring
Keeping an excellent credit score is essential to fiscal well-being as great FICO scores help individuals get qualified for credit cards and loans at good interest rates. Scammers and identity thieves destroy people's credit scores by opening up accounts which are never paid off, while the victim doesn't even realize there's anything wrong. Between the large balances and the payments which are never made, a persons credit score can be ruined in just a few months. Recovering from this can take endless amounts of time and money. Credit monitoring helps prevent identity theft from ruining your credit scores by alerting you of the problem as it's happening.
3. Credit Monitoring Shields Credit Reports from Mistakes
While occasionally your credit reports may contain inaccuracies that were merely accidental reporting from one of your creditors, in many cases these can be the first signs of identity theft. Unfortunately, the damage caused either way is the same. Incorrect information on your credit bureau can lower your credit scores dramatically and affect your ability to borrow money as well as the interest rates you are able to acquire Credit monitoring will alert you to these issues so you can determine how they occurred and begin contacting the credit bureaus to have them removed.
4. Credit Monitoring Helps Protect Your Identity As a Whole
Identity thieves don't always steal credit cards to make unauthorized purchases. In the worst cases, id thieves will take over your entire identity. Filing fraudulent tax returns in your name. Taking out medical insurance, getting home & auto loans. Having your social security number monitored can dramatically decrease the chances of these types of identity theft crimes occurring.
What Does Credit Monitoring Really Track?
-- Sources
Even the most basic credit monitoring service will monitor at least one, if not all 3 of your credit bureau reports. More all-inclusive services additionally track sources including medical records, public records and black market sites. Most services will also monitor your bank accounts and major credit cards as well.
-- Information
Credit monitoring services search for queries and newly opened accounts, in addition to recent changes to people's credit reports. Some monitoring companies, which feature more comprehensive plans, may additionally alert their subscribers to changes of new public records or to chances with their medical records or personal information such as mailing address.
Who Should Sign Up for Credit Monitoring?
Any person over the age of 18 should consider signing up for a reputable credit monitoring service. The costs for these monthly plans range from $10-$30 per month depending on the company and the services you choose. If you haven't been the victim of identity theft, don't believe it can't happen to you. Credit monitoring is a wise idea for those who have not been victims as well as those who have and are trying to keep tabs on the extent of the damage. Having access to your credit reports as well as the peace of mind that you will be alerted in the event of suspicious account activity can easily justify the monthly cost. If you are on a tight budget, there are some free monitoring companies, however these offer limited services and are not as comprehensive.
With identity theft increasing each year, now is the time to be proactive and take steps to protect your identity from theft and fraud. There's no way to prevent identity theft 100%, but credit monitoring is a good first move to limit the damage if you were to become a victim.
Want to learn more about how credit monitoring services work and and how to better protect your identity? Visit StopCreditFraud.org.
