With identity theft crimes continuing to rise, watching your credit report can help you make sure that no one is using your good name to do bad things.
Credit monitoring can’t actually prevent identity theft, but it can help you remedy the situation before it gets out of hand.
You typically pay a small monthly fee to your Bank or Credit Card Company for the credit monitoring service. A computer makes routine checks on your credit report to see if anything has changed. A credit monitoring service automatically notifies you by phone or e-mail every time the service detects something new on your report. This might include recent credit increase, accounts open, address changes or other new and unusual information that could be a sign of identity theft. If you know the activities are legitimate, you can simply ignore the alert. But, if you sense that something’s not right, you can take action immediately. Some credit monitoring services even guide you through the right channels to dispute the false information and clear your name.
Even if you don’t sign up for credit monitoring, make it a point to check your report on your own at least once a year at annualcreditreport.com
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Official documents may be a bit confusing for some people and credit reports fit into this category too. A better understanding of what these credit reports contain may help you use it to your advantage.
The most important part of your credit report is your FICO score and it should be prominently displayed in any credit report you review. If you have a high FICO score than you can get better deals and a better interest rates. Your FICO score is used by many people or companies to see what kind of financial person you are.
The form of a credit report may vary from one credit reporting agency to another. Usually the first section of your report contains all your personal information: name, address, birthday, social security number and so on. The second section of your report usually contains information that is available to the public like court records, foreclosures, bankruptcies. The third section may interest you the most because it contains all your credit payment information. It doesn’t display your on time payments but it does report on your mistakes and delinquencies. If this section is relatively empty it means that you’re probably are in good shape. The fourth and last section typically contains information on anyone that has inquired into your credit rating like a credit card company or bank. It is useful because it shows others who need information about you.
Know that you have a clearer image of what your credit report contains you can better understand it and keep an eye on your FICO score.
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The credit system isn’t a two way conversation between your lenders and the credit bureaus, it should also involve you. You have the right to question any information in your credit report that is inaccurate, untimely, misleading, incomplete, ambiguous, unverifiable, biased or unclear. Any questionable item that cannot be verified must be removed.
Justin R. Padawer, psychologist and consumer advocate explains this system. There are three consumer report agencies Equifax, Experian and Trans Union, but neither is official, they are not under the government’s wing. They are privately owned and they buy and sell our information for a profit. The laws that can be applied to these so called agencies are laws that protect consumers, or consumer protection statutes. They work to place limits upon the credit bureaus. So when a lender tells you that they can’t remove something from your credit report for seven years, by law, they are either misinformed or they are lying. The Fair Credit Reporting Act places limits on the amount of time something can be reported but it doesn’t stipulate that something must be reported.
Besides the act mentioned there is also the Fair Credit Billing Act, the Fair Debt Practices Act, and the Truth in Lending Act. They are all created to help any customer improve their credit rating. Even if these laws give you the possibility to address credit issues on your own it is a long and hard road to acting on them. You also have the possibility to address a specialized firm to fight the system for you. Correcting your credit or errors on your credit report is possible, and also credit report negatives can be removed from your credit report.
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