What Is a Credit Monitoring Service?
Credit monitoring services regularly monitor your credit history and notify you when something changes. It will alert you, usually daily or weekly, to changes in your credit – helping you to stop the theft before it gets out of control. This is especially important if an identity thief opens a new account in your name. Alerts are usually sent via email, phone, or text.
New account fraud (opening a new account vs. accessing an existing account) grew 123% in 2015 and victims of new account fraud are three times more likely to take a year or more to discover that their identities were misused compared to other types of fraud. Banks have cracked down on existing account fraud and so new account identity theft is what they’re focusing on.
Now, a credit monitoring service is not for everyone, but if you want to keep a close eye on your credit there are some great services out there. I use a credit monitoring service because I’ve been a victim of fraud in the past and I disagree with groups that say you should look at your credit report only once or twice a year.
CONSIDER THESE FACTS:
According to Javelin Research, 12.7 million Americans fell victim to identity theft in 2015, at an average cost of $5,000 per victim. But two-thirds of victims who discovered the misuse of their personal information within five months incurred no out-of-pocket expenses.
That’s what a credit monitoring service can do for you – it can’t prevent identity theft but it can greatly reduce its impact.
Before starting any service, you should look through our Credit Monitoring FAQ.
Credit Monitoring Service FAQ (Frequently Asked Questions)
Is it safe?
All of these companies are reputable and are owned by publicly-traded major corporations. These companies won’t risk their reputation working with an unethical company. They also use all of the latest encryption, consumer screening and data security technologies to make sure that your information is protected.
Won’t signing up for a credit monitoring service hurt my credit?
No. Consumers have the right to look at their credit report without it affecting their credit or credit score. When you request your credit report it’s called a “consumer pull” and has no effect on your credit. Only when you ask a possible creditor to inquire about your credit can it affect your score. For example, if you go out looking for a new car and you let a dealership request a copy of your credit report, that could affect your credit score because it implies you’re looking to open new lines of credit.
Why do they need all the information on the order form?
They need the information to verify your identity. Advanced security screens make sure that your request is valid and that you are who you say you are.
Once I sign up, will I be alerted if someone tries to open a new credit account?
You will only be alerted to credit inquiries when a potential creditor requests a credit check from the same credit bureau your service is monitoring.
In other words, if you sign up for the Consumerinfo.com, CIC credit monitoring service, the alerts will reflect new credit requests made using Equifax data. If a thief were to try and buy a new luxury car at the local Mercedes dealer, and that dealer pulled a credit check from Experian, you would not receive an alert.
You would be alerted, however, once the thief buys the Mercedes in your name and it shows up in a new account on your credit report.
This issue highlights the value of the three bureau monitoring product. No matter which bureau is affected, a three bureau monitoring product should generate an alert.
Isn’t everyone entitled to one free credit report annually?
By Federal law, you are entitled to one free credit report per year from each of the credit bureaus.