Posts Tagged ‘credit report’

Purpose of a Free Credit Report

Free credit reports are almost as common as bread and peanut butter. The explosion of offers in this regard does not replace the possible need for paid monitoring services.

However, obtaining your free credit report is your right. This is your right as of an amendment of the Free Credit Reporting Act of 2003.

The main reason this new amendment of the FCRA was added by the government to ensure that all Americans have the right to stay informed. This gives people an opportunity to learn what the three credit reporting bureaus are saying about you.

All this is done without you having to pay for it. This has been done to help combat identity theft, since fraud and errors on credit reports are so common today.

The goal of this new government act is to ensure that Americans have the right to stay informed about what these three credit reporting bureaus say about then. Yet, at the same time it gives them the right to do so without having to pay for the information.

Obtaining your Records

You can request a free copy of your credit report within a 12 month period from one of the major financial bureaus: Experian, Equifax and TransUnion.

If you don’t really plan to subscribe to the service, it is important that you cancel the trial subscription, or else it would automatically be billed to your account. In that case, you should remember the termination date of your trial period.

You can also get your files at Annual Credit Report.com. This is one of the safest and most reliable locations to obtain your free documents. This site is actually regulated by the federal government and it also is monitored by the three credit bureaus.

You also can find these documents via other websites. You should make sure that it has the official saying that indicates you are not at the Annual Credit Report.com site.

Your Rights

You should be able to obtain your free credit report without any hassle. You can report a private monitoring service if they try to make you pay for these documents.

Now, you should beware that you do not get a free credit score, but only a free credit report. Therefore, you still have the chance of experiencing hassles in that way.

At the same time, you should make sure you take advantage of what you are entitled to and do not have to pay for up front. The only time you really have to pay is if you seek out additional credit alert and monitoring services other than the free ones provided by law.

Identity Theft Protection vs. Identity Theft Insurance

Identity theft is one of the most prevalent crimes in America today. Various types of identity theft production are operating to combat this, and identity insurance is often sought.

It may be challenging for you to decide what type of safeguard against identity theft you need. It may help to use a variety of protective measures and at the same time obtain identity theft insurance.

Identity Theft Protection

Insurance can be considered identity theft protection, but that will be described in its own separate category. Here we are going to mention a variety of services used for this purpose.

One of the most common protective measures is the use of various monitoring services. For instance, you can have automatic e-mail alerts sent to your file when there has been a change made to your credit report.

This can help you more quickly identity errors. You can also retrieve the free copy of your credit report to which you are entitled every 12 months, and you may want to check your credit score often.

Another way to prevent identity theft problems is to shred all personal paperwork and documents. This includes any and all personal information including junk mail. You should also not carry your Social Security Card or other cards with important data with you unless absolutely necessary.

Identity Theft Insurance

This is a fee you would usually pay per month in case that your identity is stolen. For instance, perhaps a policy might offer up to $1 million dollars in assistance.

This is all done in the event your identity is stolen. What this does is replace whatever financial loss you have had as a result of having your identity stolen. It would cover items such as a credit card balance, bank account, or even some quick loans.

Furthermore, keep an eye on all your credit card and bank card statements. Look for any unusual activity such as bank withdrawals and such.

Introduction to Credit Monitoring Services

Too often you hear the complaint that a credit monitoring service is billing whether the customer wants the service or not. This is a shame, and it is ironic that one of the reasons you want the service is to find and remove erroneous debt items on your report.

One common solution to this is to use a debit card rather than a credit card when you purchase a service. If a service continues to bill after you’ve finished with the service, you can always cancel the debit card.

Canceling a credit card can have a negative impact on your credit file though. Using a debit card saves you this headache.

Advantages and Disadvantages

Oftentimes credit monitoring services are considered an expensive waste of time. Oftentimes you can accomplish just as much towards fixing your credit on your own not spending any money.

On average, a credit monitoring service will cost about $10 per month, per report. It is true sometimes that can monitor your own credit report for less than the average cost of these services.

However, sometimes people like the peace of mind of hiring a professional service and/or online software to do this action for them. Besides, you may want to receive reports from all three agencies at once.

With many monitoring services all three reports are included, but you may be required to request all of them at once. At the very most it could cost you about $36 a month or $432 a year to do this, unless of course you receive discounted prices as mentioned above (approximately $10 per month).

Regardless of what you pay, what you would receive for that $432 per year varies. It depends upon the services that you choose. However, in general you can expect that you’ll be alerted if someone applies for new credit.

You also have the luxury of being told if something suspicious turns up on your credit report. Most monitoring services also come with identity theft insurance that will help you recuperate the costs necessary to repair any errors that occur.

You also have the option to use one of a variety of identity theft services. On the other hand, you can monitor your own credit report even for as low as $8 per report.

You may have to do a little bit more work when you monitor your own report. However, you can save some money.

On the other hand, many people find that the expense of a monitoring service is much easier. They would rather pay this extra fee than monitor their own credit reports.

How to Prevent Rejection: Know your Credit Score

Knowing your credit score can help you prevent rejection when applying for credit. To understand why this numerical rating of your financial history matters, keep reading.

Knowing your credit score can help you in the following ways:

  • It can give you a starting point at which you would either begin to build credit or you would begin to improve your credit.
  • It can save you time, because you would have a better idea if you are even close to be eligible for any financing.
  • Knowing and checking your credit report as well as your credit score can help pinpoint errors. (Note: you are entitled to the free report, but not a free numerical score calculation.)
  • In the event you already have been rejected for a loan, you can better understand why. In some cases, it could be simply the result of a small clerical error that can be fixed.
  • Knowing your credit score can also help you gauge what hurts your credit the most. This in conjunction with viewing your credit report can help you come up with a repayment plan.
  • Knowing your numerical rating of your creditworthiness can also help you compare yourself with the national average. This is one more incentive to help you improve your situation if you need help.

Ordering your Score

Your credit score is a separate entity than your credit report. Therefore, unlike your credit report you are not entitled by law to obtain it for free per request of an agency. It may be given to you, however, as a promotional tool to get you to sign up for monitoring services.

Warnings

If you are in the process of requesting free monitoring services on your files, make sure you use a secure server. This is true as well when seeking a free credit report.

Credit Treadmill: Inspiration for Improvement of Credit

Unmet financial obligations results in extreme stress. This emotional turmoil is a by product of mounting bills. Sometimes it never seems to end, and you wonder how this all started.

If this sounds like you than you are more than likely the victim of the credit treadmill. This is not a cycle that is easy to get off, nor is the problem immediately noticed.

The Stress of It

The financial burden felt actually affects a person in difference ways. For instance, a person’s sleep may be disrupted. It can ruin you, as you continue to pull your hair out.

Even health problems could occur as a result of the stress. This then adds to the pile of bills because now you need to take care of yourself medically, and that can be expensive.

Don’t Procrastinate!

The opposite is true as well. Knowing that you are working toward wiping out outstanding debt helps enormously. The weight is starting to be lifted off of your shoulders.

This is one reason why it is time to not procrastinate any more. This is one reason why you decided to seek a copy of your credit report. You need to face the really bad music and learn how to play it better the next time around.

How to Prevent Credit Report Fraud

While trying to seek your credit report there are a number of ways that unscrupulous thieves can take advantage of you. They will find any way to steal your identity and one way would be for them to offer fake “free credit report” opportunities.

The main way they get you is to require a credit card even if it is supposed to be a free trial. However, sometimes they try to cancel and put additional charges on top of the ones you already made.

They also then try to make it difficult for you to cancel your free trial. Then you are stuck paying probably for additional services you no longer even want.

Prevention Tips

Make sure you go to a recommended source to obtain a free credit report. Annual Credit Report.com is probably your best choice, but any comparable to this that are reputable would be fine.

If you must use a credit card because you think the additional credit monitoring services may help you then keep the following in mind:

  • Never sign up unless you know the server is secure. This will prevent third-party fraud.
  • Never give your credit card number to a company that you do not recognize. This will reduce risk of later becoming the victim of unauthorized charges.
  • Make sure you verify the name of the company providing credit report monitoring services. Verisign seal information is one way to do this, or you could check with the Better Business Bureau if you have any doubts.
  • Only fill out the information that is required. Be very careful about to whom you give your social security card, driver’s license, birth date, and other information.
  • Do not pay for any services you could get for free. For instance, you can have free fraud alerts placed on your annual credit report.

The Three Credit Bureaus: A Short Profile

It may interest some people to get a profile of the three major credit bureaus in the United States. This is mainly to get to know the agencies in charge of keeping your credit report on file.

This is a very brief history of TransUnion, Experian, and Equifax. It gives you an idea of where they are located and such and how they got started.

Some History

TransUnion was first created in 1968. It was founded by the Union Tank Car Company. Its role as a credit agency took place after the purchase of the Cook County Credit Bureau in 1969.

Today the TransUnion Credit Union is based out of Chicago, Illinois. It operates 250 offices in all.

Experian is actually known as a “credit informational group” according to Wikipedia. It was started in 1980 by John Peace in Nottingham. It has over the years (since 1996) acquired agencies formerly known as TRW Information Services, Bain Capital, and Thomas H. Lee Partners in 1996.

Then, in 1998 Experian acquired CheetahMail. This was a business founded in 1998. Experian is the one that offers the Triple Advantage (SM) Credit Monitoring services. They still require a credit card number for a free credit report but are now complying with the FTC as far as providing free credit reports.

There was an issue back in 2005 during which time it was found out that Experian violated FTC rules. Apparently they were not within-and are still not within Federal Trade Commission rules-because of the fact that they require a credit card number from consumers to receive it.

Equifax is actually the oldest of the three agencies. It was founded in 1899 and is today responsible for over 400 million credit accounts worldwide.

Equifax (formerly Retail Credit Company) especially started to grow in the 1920s and the planting of offices spread throughout the United States and Canada. By the 1960s it has held files for millions of Americans and Canadians.

Of course, just like other credit agencies this one has had its share of dirt dug up about it. There has been a fair share of rumors and inaccuracies pertaining to consumers that were said to be retrieved by Equifax over the years. This has to do with fact that this credit bureau was sued for getting too much into people’s private lives in order to make their situation worse.

All in all though, we still have to deal with Equifax as well as the other two bureaus (TransUnion and Experian). They can either be our friend or our enemy. Most of the time though they are there to help consumers and any problems with these credit bureaus should be reported to the Federal Trade Commission immediately.

The Benefits of a Credit Repair Attorney

The reason people hire a credit repair attorney (a.k.a. debt attorney) is to help them work out their financial situation. However, in this case it is more than that. They usually are on the verge of or are already in legal trouble.

The Role of a Credit Attorney

A basic service provided by a credit repair attorney is this: to answer common questions about budgeting and crediting as well as legal rights pertaining to debt negotiation.

They also help assess length of time needed to repair credit. They also negotiate in the event a client is in legal trouble and is facing judgment or lawsuit.

While helping a client who is facing legal troubles, they also present a variety of payment options. Often people in debt are spared the plight of bankruptcy but even if this action is necessary a debt attorney is the ideal professional to turn to.

Another major issue is victim rights. Often if there are negative marks on a credit report that are not the fault of a consumer this can be reversed. A debt attorney may help individuals find a way to deal with it and/or at least help the person right letters of request.

The letters of request would be for alerts. It would also be to have negative marks on their credit to be taken off. Usually there is a process of proving that the identity theft did take place, which involves tracking unauthorized usage of personal and financial info.

Sometimes a credit repair attorney can also help fix honest mistakes. For instance, maybe a creditor may have forgotten to mark a balance paid and you have proof that you have paid it.

If you show the person representing you all relevant receipts and records, it can help get your report corrected much faster. This will help you on your way to obtaining better for yourself in the future.

The Purpose of a Credit Bureau

A credit bureau can either be your best friend or your worst enemy. They provide information to individuals and businesses as well as banks, landlords, employers, and other institutions.

This is a list of some of the reasons that a credit bureau exists:

  • It helps monitor a person’s financial history. This is part of what determines a person’s creditworthiness. This is one of the first steps towards getting a loan-examination of a person’s credit report and credit bureaus hold this information.
  • Another purpose of a credit bureau is to verify the existence of a credit or loan applicant. This helps store owners, banks, and even colleges and employers know that they are dealing with who they are dealing with.
  • Credit bureaus help combat identity theft. Often alerts are placed on credit reports to help prevent further unauthorized action. Certain portions of a credit report may be blocked when this happens. In other words, one role of a credit bureau is to protect consumers.
  • Organizations such as Equifax, TransUnion, or Experian are also around for another reason. These organizations prevent creditors from trusting in people who are not responsible with money.
  • Another reason that credit bureaus exist is for recording-keeping. These organizations keep track of all your spending as well as all your major purchases and other inquiries. They also keep track of your financial obligations and how timely you make your payments.
  • Another reason that organizations such as the ones mentioned in this article exist is to help repair your financial history. Being able to improve your credit history is one incentive to make better financial decisions.

Using your Credit Report

Often people seek a free credit report to help them come to terms with changes that need to be made. They also do it to make sure there is no activity that counts against them that has resulted from charges they did not authorize.

Identity Theft Statistics and Free Credit Report Precautions

You never can be too careful when using the Internet. This is evident in the number of identity theft cases that take place annually-and even daily, weekly, and monthly. This pertains to making purchases as well as using free credit report services and shopping in traditional stores.

Statistics

According to Better Business Bureau and Javelin Strategy & Research, over 9 million cases of identity theft crimes have taken place now for two years in a row. Within the past five years there have been a total of over 30 million victims, as reported by agencies such as the FTC and BBB.

Some more interesting facts you might want to know can help you be safer. Take a look below:

  • About 71% of fraud occurs within a week of someone’s personal identification being stolen. Sometimes the crime takes place almost immediately if it is a credit card being used that was stolen.
  • Although online identity theft is on the rise, only about 11% of identity theft crimes originate here. Stolen wallets and physical documents make up for about 43% of all identity crimes.
  • The breakdown of identity theft cases is as follows (2009): 26% credit card fraud, 18% utilities fraud, 17% bank fraud, 12% employment fraud, 5% loan fraud, 9% government fraud, 13% other. This of course are approximate numbers and 2010 stats are going to be different.

Ways Identity is Stolen

Your personally identifiable information can be stolen in a variety of different ways. Your credit cards and/or credit card digits is one of the most common forms of identity theft. This takes place as fraudulent websites set them selves up appearing as a legitimate company.

This often is the case when ordering a free credit report, which when it is legit can save you from credit card/identity fraud. However, if you enter information into a fake free credit report site you are in trouble, especially if you are entering credit card numbers or other personal data over a server that is not secure. Your financial and personal information is then stolen.

Also, numerous traditional brick-and-mortar stores are sometimes careless about asking for a picture I.D. when a purchase is made. So, when someone uses a stolen credit care it often passes through electronic credit card systems.

However, it is not just physical credit cards and credit card numbers that are stolen and exploited. Driver’s license and social security cards and numbers, birth certificates and birth dates, banking account numbers and checkbooks, and even credit reports are stolen.

Why Identity is Stolen

It is done for a variety of reasons. One of these reasons is to secure a home loan and another is to apply for a job, or to be able to find a way to have a utility or phone line turned on (i.e. using a child’s name). It could be even done to get away with committing a crime.