What Are Credit Monitoring Services & How Do They Work?  

Many people make use of the credit monitoring services in order to be alerted to possible credit fraud and ultimately, reduce its negative effects on their finances. To ensure this level of protection, individuals to sign up for a service that will keep tabs on one or several of your major credit reports and notify you when there is a new account that is opened in your name, someone makes an inquiry to your file as well as when other possibly suspicious activities crop up. Most of the credit monitoring packages will also give you access to at least one of your credit scores and reports. For this reason, consumers usually make use of credit monitoring to keep track of their credit building progress.

Various companies are offering credit monitoring services which include the three primary credit bureaus as well as many of the major banks. It is not a big surprise that there is a big market for this kind of product since identity theft is becoming one of the most common complaints from consumers for many years.

Even though credit monitoring will not really prevent identity theft as well as other related loan or credit card loans, it still has the potential of alerting you regarding unauthorized access to your personal information before you start noticing a problem.

How It Works

Although logistics are basically provider specific, the credit monitoring services typically track your credit file and send your alerts when there are changes. Many of the companies are offering these notifications through a phone call, email, or text message, which depends on your preferences.

The forms of activities that credit monitoring services are going to bring to your attention include the following:

  • New Accounts

Credit reports note each time a new loan or credit card has been opened under your name. When there is a new account that appears on your file because of the mistake of the creditor or as the result of a fraudulent activity, it is better to know about it right away instead of waiting until you receive a bill through mail.

  • Hard Inquiries

Every time you apply for a loan or credit card, the respective financial institution is going to pull your main credit reports, which are referred to as a hard inquiry to your credit history. Any unexpected hard inquiry, like the ones that are not triggered by your application submission, is a sure sign of fraud. The identity thieves are well known for the use of the basic consumer data include the name, address and the Social Security number for opening financial accounts under the names of other people for them to rack up the costly charges and leave it up to the user to clean up the mess they did.

  • Changes to the Existing Accounts

You will also receive an alert when your credit report indicates a significant change in your payment and spending habits.

  • Changes in Address

A criminal who has the basic biographical information and access to one of your debit or credit cards can officially make changes to the address that you have on your file with the postal service so that they will receive your mail and have better control on your life. Most of the credit monitoring services are going to alert you about this kind of changes so that can easily straighten out the matter before things can get further complicated.

  • New Public Records

The information regarding bankruptcies, civil court judgments and tax liens is included on the consumer credit reports and while everyone will hope to spot an identity theft before it can even get this far, the credit monitoring service is going to alert you once someone encounters these forms of difficulties while still impersonating you.

The credit monitoring service is also going to notify you regarding these changes in a matter of 24 hours after they have noted your credit report, which will then fulfill its role as your official identity theft watchdog. As soon as you discover about the possible identity theft, it will be so much better so that you can also initiate the right damage control procedures before the fraud will wreak too much havoc on your financial files.

For the past few years, the companies have also come up with identity theft solutions which as far more comprehensive as compared to what you can get from the traditional services on credit monitoring. For instance, they might also monitor any sex offender registry, activities on your bank account, applications for payday loans, and more. The advent of this kind of services only underscore that there is indeed a growing concern among the consumers when it comes to identity theft in today’s personal financial environment that is becoming more electronic than ever.

The capacity of tracking the progress in credit improvement is also the other primary benefit that you can get out of the use of a credit monitoring service. These services will also provide you with better access to all your credit reports as opposed to just receiving one copy each year and possibly, you might also receive your credit scores at the same time. Most of the monitoring companies usually offer deals with certain credit score providers even though the scores that they will provide are not guaranteed to be the ones that are being used most often by the lenders. This will not just give you the chance of routinely parsing your files for any error for at the same time, this will also allow you to stay updated with your credit standing which will then improve how you are shopping for financial products and determine if the credit building efforts are needed.

As of this moment, some of the major players in the world of credit monitoring include TransUnion, Equifax, Experian, FICO which is a credit scoring company, most of the largest banks of the nation as well as niche businesses including Identity Guard, LifeLock and TrustedID.

Credit monitoring services are no doubt important to keep track of your finances so choose the one that will best suit you.

Credit Monitoring Services Review

Credit monitoring services scrutinize a consumer’s credit report at one or all three credit bureaus for a monthly fee, alerting the consumer to late payment items, identity thefts, inquiries from potential creditors and employers, and any other credit report changes. The pros and cons of this service are fiercely debated. But there is much to be said for the advantages of employing a credit monitoring service. The consumer’s credit score is a number that extends into all aspects of an individual’s financial life; guarding that number and improving it can amount to large savings over a lifetime. And with finances being a rather complicated affair for most people, negative items and mistakes can appear on credit reports that can go under the radar of the less than attentive, and credit monitoring is an astute defense against identity theft. Furthermore, a credit monitoring service can be instrumental to the consumer in reaching the highest category of creditworthiness where the best financial terms are offered.

Necessary or unnecessary service

Critics of credit monitoring usually state that it is an unnecessary service since consumers can keep track of their own credit reports. They point out that a consumer can receive a free credit report staggered over the year from each of the three credit reporting bureaus—Experian, Equifax, and TransUnion—and become aware of any mistakes or problems which develop.

Following that track leaves many loopholes in credit monitoring where all sorts of problems can arise. As credit reports are known to be error prone,   negative items such as late payments and account mistakes can sabotage job prospects for employment seekers. Large charges to credit cards can lower credit scores at the most inopportune times, causing rate changes on new loan applications. Identity theft may be occurring with fraudulent new accounts opened up under the consumer’s name, when immediate notification to the consumer is the most urgent. Looking at each report only once a year leaves these gaps which can be costly to the consumer.

Credit monitoring is a superb educational tool to gaining greater insight to one’s financial affairs and as a result leads to greater abilities to manage those affairs. Monitoring one’s credit through a service will allow for immediate feedback to the consumer of results for car loans, mortgage loans, and credit card applications. The credit score numbers will fluctuate in response to additions and deletions in the report, educating consumers in ways to better manage their finances. Also, credit monitoring services offer many online resources to help the consumer expand their financial know how.

Saving money with credit monitoring

Most credit monitoring services will cost the consumer between $10 and $20 a month, adding up to $120 to $240 for the year. It might seem like a high cost, but when consumers consider the benefits of a service, it can actually save them money. The consumer is given the tools to improve his or her credit score, and the savings can be in the hundreds and thousands of dollars. With a credit score of 760 or better, the consumer will receive the best available interest rates. In the case of a mortgage over a period of 30 years, this can amount to tens of thousands of dollars. Also, car and life insurance rates are partially dependent on a consumer’s credit scores, where the impact will again be reflected in substantial savings if the credit score can be boosted into the excellent category. When all these benefits are considered over the financial lifetime of a consumer, identity theft protection reviews excellent value for a minuscule cost.

Credit monitoring and identity theft

With the rise of identity theft crimes every year and the proliferation of new ways to steal it, everyone agrees vigilance is definitely needed to protect against the illegal use of credit information. Critics of these services say credit monitoring does not stop identity theft, and they are right, since nothing can guarantee 100% protection against identity theft. What credit monitoring services offer is immediate alerts that something is amiss when new credit accounts or address changes have appeared. With this knowledge, the consumer can immediately put a fraud alert or a freeze on an account. So many ID thefts go on for weeks or even months because the consumer is unaware until he or she receives billing statements or other indications of wrongdoing long after they have occurred. ID thieves often change the victim’s address, so incriminating billing statements are redirected to another location. If the consumer becomes the victim of identity theft, most credit monitoring services provide insurance protection and legal services to help the consumer. All in all, credit monitoring is a top defense to guard the consumer’s interests against the illegal activities of criminals.

 

5 Steps To Avoid Being A Credit Fraud Victim

Credit card fraud is growing at an alarming rate across the globe and most of them involve online transactions. As a matter of fact, credit card fraud online is expected to increase to billions by 2008, based on the analysis of financial experts. This is quite a worrying statistic considering the detailed research as well as efforts from main credit card companies including MasterCard and Visa to prevent this growing fraud.

Typically, credit card fraud is defined as buying products or services from personnel not associated or connected with particular credit card making the transactions. Thus, the merchants are tricked into releasing merchandises or rendering several services to a false identity. The growth of this kind of fraud is still increasing and expected to grow in the long run.

Credit card fraud is a big problem as well as a dilemma within the society today. To reduce the chances of being a victim of credit card fraud, there are several steps you may consider. Subjects may include securing your bank account information, checking statements, keeping the credit cards safe, and verifying your visa card. Some tips may include not giving your PIN or bank passwords to anyone, throwing your bank statements in the bin without shredding it, and many more.

credit card fraudThe most typical method used by criminals is targeting cards and other information in offline shops, unsecured online transactions, and in conversation. If you have a credit card, you should not hand over it to anyone. Keep it out from possible fraudsters and don’t write your PIN number. Keeping your credit card in a safe and secure place is also a good idea.

Majority of mail order, internet, and phone fraud happens because of the reason that one’s card details are stolen. Due to this, don’t let your credit card out of sight and pay importance to it if you don’t want to fall from the criminal’s hands.

Keeping your credit card secure and safe can make a huge difference. But, similar to every consultant, fraudsters are also experts in their field and may acquire information from the smallest chance presented to them. So, check your bank statements regularly. When you get your bank statements, check if there are irregular or unauthorized transactions. If the statement presented such fraudulent transactions, call your credit card company or bank at the soonest date and let them know about the illegal activity.

There are other steps you may consider when avoiding credit card fraud. If you don’t want to suffer from the consequences of being a victim of credit card fraud, never forget to do those steps mentioned above and always ensure that your personal information is protected. Today, there are also some companies offering credit card fraud protection services. Depending on your choice, you can try such services to protect yourself from credit card fraud. But, make sure that your chosen provider is reliable and has a good reputation when it comes to providing such solutions as this can make a huge difference in the long run.