Credit monitoring makes it easier to stay on top of your credit. Credit monitoring can help you spot errors or signs of identity theft, so you can take steps to address them.
Errors on your credit report are more common than you might think – and they can affect your credit score. That could lead to higher interest rates or make it difficult for you to get the credit you need.
Credit monitoring also makes it easier to quickly spot suspicious activity, such as new hard inquiries made without your permission or new accounts you didn’t open.
Keeping an eye on your credit is a healthy financial habit, and credit monitoring is an easy way to make it part of your routine.The types of activity that a credit monitoring service will notify you about – any of which could be signs of fraud if unexpected – include:
• Hard Inquiries: When a credit card or loan application is submitted in your name, the financial institution will run a credit check, adding a “hard inquiry” listing to your credit report.
• New Accounts: Credit reports note whenever a new credit card or loan is opened under your identity.
• Existing-Account Changes: Credit reports include details on your payment history and highest balance with each of your credit cards.
• New Public Records: These include information about bankruptcies, tax liens, and civil court judgments.
• Address Changes: Any address associated with a credit card or loan listed in your name can be found on your credit report (with a few key pieces of info, a criminal can officially change your address on file with the U.S. Postal Service to intercept your mail and sneakily assume greater control over your financial life).
• Non-Credit Red Flags: In recent years, security companies have created identity-theft solutions that are more comprehensive than a traditional credit-monitoring service. For example, they might monitor sex-offender registries, bank-account activity or payday loan applications. Such providers are often referred to as “identity-protection services.”
Obviously, if these sorts of developments were not personally authorized or initiated by you, you should act under the assumption that they’re evidence of fraud.