Reasons to Monitor Your Credit Report
Learn about the 4 compelling reasons why it is crucial that you keep a lookout on your credit
Many of you may have good credit. In fact, the average consumer has a credit score of 685 which is lower than years past but still good enough to obtain a loan for a car, home or even a personal loan. While you may think as long as you know your score you don’t need to watch it could be one of the biggest mistakes you've ever made.
For the group of people who are meticulous and methodical in monitoring their credit profile, they can achieve this by accessing a free credit score report from every one of the credit reporting bureaus just once per year. They do not need a service to watch their credit report profile or suspect activity. And, for shoppers who're not proponents of credit report monitoring and claim that the service does nothing to actually avert identification theft or credit report fraud; some reasons below will explain the advantages of the service.
Reason #1 - Credit Report Errors Are Very Common
Because an application for a mortgage, auto loan, and credit cards is affected largely by one’s credit score, being certain your credit report is correct turns out to be a lot more vital than ever. In the past, a borrower could simply obtain documentation to show that an account was not late or did not belong to the borrower and include it in the application to obtain approval.
Things have changed from how documentation worked in the past where a borrower or applicant could just get a receipt that an account was indeed paid in full or paid on time and their application would be approved. Nowadays, if derogatory data reduces a applicant’s credit score under 620 threshold, no matter if it is untrue or an error, the borrower takes the onus until the negative data is taken off their credit report and then their report can be re-scored once more.
Your credit is very important and to ensure the information is accurate you need to be constantly watching it or have a service monitor so you will always have your credit availabel when you need it most as well as paying a lower interest.
Reason #2 - Cybercrimes
Cybercrime tops $100 billion a year, outpacing global drug trafficking, according to industry experts
Reason #3 - Victim of Identity Theft
According to the Federal Trade Commission, 10 million consumers are becoming innocent victims of some type of identity theft every year so the odds are pretty high. While there is no one perfect answer to protecting your social security tax id number, credit card info, and passwords, normal monitoring of your credit report is an effective method to detect a problem before it snowballs and becomes worse.
Since identity theft has become a growing constant threat, it is absolutely vital for consumers to engage in an approach that is defensive to safeguard their sensitive information. Consumers are able to check their credit reports once per year from the 3 major credit bureaus (Experian, Equifax and Trans Union.) but those other 11 months may be the only opening thieves need to do some extreme damage to your revolving charge accounts and identification.
A credit monitoring service can give you peace of mind by furnishing you a regularly scheduled copy of your credit report from each of the 3 major bureaus or just one on a monthly or quarterly basis. In addition, consumers are able to receive activity alerts of any changes in a credit report . The most important notifications is one indicating that an account has been opened in your name. If this account is one that you are not familiar with or do no recall applying for, you can start instant action to make sure the account is closed.
Some Recent Examples of ID Theft
A daring and well-organized identity-crime group recruited waiters at steakhouses and other upscale restaurants to steal diners' credit-card information and then used the card info for high-end shopping sprees.
Source: Businessweek Report
Authorities say more than 130 million credit and debit card numbers were stolen in a corporate data breach involving three different corporations and two individuals.
Source: Fox News Story
What Can You Do?
Starting at age 25 you should automatically get a statement from the Social Security administration by mail each year. It is normally sent about 90 days prior to your birthday.
Your yearly Social Security Earnings and Benefit Estimate Statement should itemize all earnings recorded to your SSN profile, along with an estimate of benefits for you and your family. In addition, it can alert you that your identity has been stolen for employment purposes.
It is very important that that you check your Social Security Earnings and Benefit Estimate Statement yearly. In fact, if you haven't received your statement, that could, itself, be a symptom of identity theft.
What to Look For
On the statement, look for:
- Incorrect, missing, or overstated earnings. (Earnings should agree with each year's W-2 or tax return.)
- Incorrect or misspelled name.
- Incorrect date of birth.
If you see employment listed that is clearly not yours, consider it a red-flag that should be researched.
Identity theft can happen to people at any time. It's certainly possible you are meticulous in looking over your credit reports with each bureau one time each four months, although an id thief may very well be underway at this moment. A credit report monitoring service can give you details back to you on a weekly or monthly basis in reference to activities in your credit account which will warn you a lot sooner
Reason #4
Consumers are able to just monitor a single credit reporting bureau at any given time: Many credit monitoring companies offer an all-inclusive plan for each of the 3 credit reporting agencies in one report. Since each credit agency has their own timeframes of when to report activities it is a crucial factor to see all 3 reports.
BONUS Reason
A responsible consumer's time is certainly more valuable than the $10-to-$19 a month cost for the service: Consumers will enjoy numerous hours of time saved by receiving reports directly from a credit monitoring service. The reports accurately alert you to changes in new activities, account openings and closings, credit status, and anything else that may impact your credit standing all at a glance without having to go through an in-depth credit 101 course.
