Credit Monitoring: How it can Help

Although identity theft or unauthorized used of credit impacts relatively few consumers, credit monitoring can be useful if you're working on improving your credit, or for ensuring the accuracy of information in your credit report.

Credit Monitoring: Woulda, Coulda, Shoulda

Opening a credit card statement and finding unauthorized charges can be the beginning of big problems. Although consumers may be protected against unauthorized charges under certain circumstances, it can take months to identify and unravel the consequences of unauthorized use of your credit cards. Here are some consequences of unauthorized use/identity theft:

• Damage to your credit score: Unauthorized users use your credit for shopping sprees, but they don't pay the bill. If they've used a fraudulent address to access your credit, you may not be alerted to fraud until several payments have been missed.


• Resolving unauthorized charges: You'll want to keep your credit accounts paid current until unauthorized charges are removed from your account.


• Identity Theft has far-reaching consequences: If your identity has been stolen and used to open or use multiple accounts, your credit score can be seriously damaged in a short time. Credit scoring considers factors including timely payment and account balances; if your cards are suddenly charged to their limits and show past-due payments, your credit score will suffer.


• Impact beyond credit accounts: Your credit score may be used in establishing insurance premiums and as part of the hiring process. If your credit has been compromised without your knowledge, you may pay higher insurance premiums, interest rates, and be passed over for employment.

Ordering Your Free Annual Credit Report

Consumers are legally entitled to one free annual credit report from each of the three major credit reporting agencies, but these free reports do not include the credit score assigned by each of the credit bureaus. You can order your free annual credit reports and purchase credit scores online.

Checking your credit reports and credit scores annually is a good way to verify that the information reported is accurate, but ordering an annual credit report may not protect you from the consequences of identity theft or unauthorized credit card use. A credit monitoring service can offer peace of mind by providing continuous access to your credit reports, and alerts for irregular or suspicious account activity.

Sources:

• Annual Credit Report
• Identity Theft

About the Author:
Karen Lawson started writing stories about birds and surfing at an early age. For more than ten years, she enjoyed a productive corporate career in mortgage banking before moving to Reno, Nevada in 1997. Karen earned BA and MA degrees in English (specializing in writing) at the University of Nevada. Significant areas of research and writing include truth and ethics in creative nonfiction, medical humanities, and the symbolism and lore of birds in American literature and culture. Karen has taught English at a community college, is writing a collection of poetry, and enjoys birdwatching and walking her basset hounds.