5 Ways To Prevent Identity Theft And Guard Your Credit
Credit has been a viable means of gauging a person’s financial standing since time immemorial. When the 2017 Equifax data breach threatened the financial industry, the value of having good credit become all the more important. In fact, without it, you cannot get a loan, buy a car, purchase a home, and many more. Loan officers will definitely check your credit background before approving any of your applications. This is why ensuring that your credit score is high is crucial.
When the Equifax breach revealed that many consumers’ private data had been exposed and made public, people had become more wary about the possible threats. As many as 14.5 million were affected by the hack, with their private information and supposedly secure credit histories laid out in the open for anybody to exploit. This leads us to the question: If something like this happens to you, how to ensure that your credit is safe and your details don’t get stolen?
Fixing your credit report errors is a long and painful process. In fact, the US Consumer Financial Protection Bureau even admits that its investigation and repair processes need to be updated and fixed, as well. With the time and effort it takes to go through the usual channels, many consumers just decide to correct the mistakes themselves to protect their financial integrity.
When an error shows up on your credit report, it can’t be taken out by simply telling investigators that it’s a mistake. It requires a long process that can take months, sometimes years. However, there are things that you can do to make sure that the major issues are addressed before the problem escalates. Here are 5 ways you can monitor your credit, ensure that your private information stays concealed, and improve your credit score.
- Be proactive and check your own report immediately.
The moment the 2017 Equifax breach happened, consumers were advised to check their credit reports right away to spot any discrepancies. You can visit the official Annual Credit Report website to file a request and see if your credit report had been exposed to anything suspicious in the past months. You can avail of one credit report every 12 months for free from either TransUnion, Equifax, and Experian. There’s no other site to check because Annual Credit Report is the only one with permission granted by Federal law.
- Freeze your credit.
There’s no quick and immediate way of knowing the extent of the Equifax hack. In fact, investigators say that it might take years for the financial sector to feel its full effect. Setting up a credit freeze is one way to protect your credit report from outside threats. By “freezing” your credit report, you make it difficult for hackers and other third parties to access your data and open up new accounts using your name and details. Credit investigators will also not be able to access your report unless the freeze has been lifted.
However, if you want to take out a loan or line of credit in the future, you will need to have the freeze lifted. Contact any of the three agencies to make a request, which could cost you a small fee. Otherwise, a freeze may stay on for up to seven years, depending on which state you filed them. Some areas will allow a freeze on your report for as long as you don’t lift it.
- Deal with questionable accounts right away
Do not ignore disputed accounts and think the errors will go away on their own. Face the issue head on and correct what needs to be changed immediately. If you see something on your report that’s amiss, contact the creditor of that account, as well as any of the three agencies to dispute the information and have it removed from your report. Be careful not to pay the disputed amounts because that will create a negative impression on your credit score.
- Alert the authorites of fraud
If you don’t want to freeze your credit, you can file a dispute by setting up a fraud alert. This is usually done for a period of 90 days, depending on your state’s policies. You can also use it as backup protection when you decide to temporarily lift the credit freeze because you want to apply for a loan to buy a house. Having a fraud alert linked to your report will compel creditors to search you up first and verify your identity before they approve anything under your name.
Thankfully, applying for a fraud alert with TransUnion, Equifax, and Experian is pretty much straightforward. All you need to do is provide proof of your identity and file a request with any of the three. It will then notify the other two so that the alert is extended widely. An expanded fraud alert can go for as long as seven years.
- Monitor your bank statements and make sure bills are paid.
Bills are easy to overlook but they are the foundation of your financial health. Make sure you pay them on time. By checking your credit card and bank statements regularly, at least once a month, you can watch out for the early signs of potential fraud. Also, by committing to pay bills on time, you can shield your credit report from any negative impression. Take note that around 35 percent of your credit score is taken up by your payment history and ability to meet deadlines on time.
Good credit is very important because it allows us to enjoy life’s pleasures and comforts. Access to financial resources not only opens up opportunities for a better life, it also widens the net to include our families’ quality of living. This is why we should never take our credit standing for granted. When something like a hack threatens our report, we should make aggressive efforts to correct them and make sure that our ability to obtain a comfortable means of living is not hurdled by these errors. More importantly, we should always be vigilant and protective about our personal information, so none of this happens in the first place.
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