Credit report monitoring is a service that tracks changes on your credit report, including your credit scores and possible suspicious activity. It allows you to track your credit health, spot inaccuracies and help you stay alert to any signs of identity theft.
A credit report monitoring service can allow you to receive alerts for activity such as new account applications, the opening of new accounts and changes in personally identifiable information (PII).
In this article, we’ll cover
- Why is Credit Report Monitoring Important?
- What Does Credit Report Monitoring Do?
- What Credit Report Monitoring Doesn’t Do
- Credit Report Monitoring Tips
Why is Credit Report Monitoring Important?
Here are some of the reasons why it’s important to monitor your credit report and credit scores.
Identity Theft Protection
When it comes to identity theft protection, credit report monitoring is a helpful tool that can help you determine whether your information is being used fraudulently.
Identity theft-related fraud is the fastest-growing online crime in the world. As the internet becomes a bigger part of daily living, unfortunately, personal information is becoming increasingly vulnerable to cybercrime. Hackers target company databases for access to customer credit cards, Social Security numbers and other sensitive information that can be used for financial gain.
With more than a billion records exposed by data breaches so far, millions of people are falling victim to identity theft every year. According to Javelin Strategy and Research, more than 14.4 million consumers in the U.S. were victims of identity theft in 2019. That’s one in 15 people.
With so much information up for grabs on the dark web, it’s difficult to prevent identity theft from happening. However, credit report monitoring can help you discover suspicious activities early, so you can take steps to help protect yourself.
The better you manage your finances, the easier it is to reach your financial goals. Having strong credit can help you qualify for better loans, lower credit card interest rates and lower mortgage interest rates, which can save you thousands of dollars in the long run. With credit report monitoring, you can track your progress and identify areas that can positively impact your credit score to help make those big life transitions when the time is right.
What Does Credit Report Monitoring Do?
Your credit file contains information about your credit activity. You can see credit accounts you have open, how much debt you owe, whether you’ve been making your payments on time and your PII. Credit report monitoring can help allow you to keep track of all of this and alerts you of activity such as:
- Hard inquiries on credit reports. These occur when financial institutions run credit checks after someone submits loan or credit card applications.
- New accounts opened in your name
- Payments and balances on your credit accounts
- Name changes or new addresses added to your credit file
- New public records such as information on court judgments and bankruptcies.
What Credit Report Monitoring Doesn’t Do
It’s important to keep in mind that credit report monitoring notifies you of suspicious activity and helps you get in front of an identity thief. However, it does not completely prevent identity theft from happening.
- Here are things that credit monitoring does not do:
- Stop someone from applying for credit in your name
- Keep your PII safe from data breaches
- Alert you if someone applies for a job in your name
- Stop phishing emails
Credit Report Monitoring Tips
Once you have decided to sign up for a credit report monitoring service, here are a few tips to keep in mind to get the most out of it:
Tailor your notification preferences
Tailor your notification preferences according to your lifestyle. For example, if you check text messages more than email, set your notification preference to text messages.
Apply a credit freeze
If you notice suspicious activity on your credit reports, you should consider applying a credit freeze. This prevents creditors from accessing your credit file. If they can’t access your credit reports, then they also can’t extend credit which prevents others from opening a new credit account in your name.
Place a Fraud Alert
A fraud alert is a notice on your credit report that notifies creditors that your information has been compromised. Placing a fraud alert adds extra steps to the identity verification process, making it more difficult for an identity thief to open a new account.
Act on suspicious changes
If you find something potentially fraudulent or inaccurate, don’t hesitate to take action. IdentityIQ services offers U.S. based customer support that can help you through every step of the identity restoration process.