Whether you use a third-party credit and identity monitoring product, or do it yourself, keeping an eye on your credit reports can help protect you from the damaging effects of identity theft. Criminals who steal your identity can use it to either take over your existing accounts or to use your good name to open new accounts that they can then run up. By watching your credit activity closely, you can usually minimize its impact on you.
Finding Unknown Credit Inquiries
One of the first indicators of identity theft is when inquiries start to appear on your credit report. Whether it’s you applying for a new account or a criminal, a lender will usually check your credit report before opening an account. If you are regularly monitoring your report, you or the credit monitoring company will spot the inquiry early in the process. If it’s not an inquiry you initiated through your own actions, acting quickly could potentially stop the account from ever being opened.
Finding New Accounts
When an identity thief runs up your credit cards or empties your bank account, you usually find out relatively quickly by having your card declined, being unable to withdraw money at an ATM or getting a statement with unfamiliar transactions. If the identity thief opens a new account, though, you might never get notification, until you get declined for a loan or suffer some other credit-related mishap. Credit monitoring includes watching your own credit report for new accounts that shouldn’t be there so that you can shut them down.
Contacting the Credit Bureaus
If you find unfamiliar accounts or signs of identity theft on your credit report, immediately contact one of the three credit bureaus (Experian®, Equifax® or TransUnion®). By doing this, you can set up a fraud alert which prevents anyone from accessing your credit report without your specific permission. Be sure to keep detailed records of any calls that you make to help you organize your claim and recover from identity theft.
Beyond Credit Monitoring
While credit monitoring can help reduce the risk or impact of identity theft, you can also play an active role in protecting your good name. Destroying documents that contain financial information and keeping your Social Security number out of your wallet can help to protect your personal information. Being careful where you enter your information online can also protect you from Internet sites that are designed to steal your information. Remember, you’re the best first line of defense again the risk of identity theft.
About the Author
Solomon Poretsky has been a writer since 1996, with experience in the fields of financial services, real estate and technology. Poretsky holds a Bachelor of Arts in political science from Columbia University.
This article is provided for general guidance and information. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.
Published by permission from ConsumerInfo.com, Inc. © 2014 ConsumerInfo.com, Inc. All rights reserved.