Be honest: How often do you review your credit report? Some sources suggest that the majority of Americans check it once per year or less.
If you ask us, that's a problem. Why? Because unexciting though it may be, your credit report contains valuable information. If you're an unknowing victim of identity theft, there would almost certainly be red flags on your credit report. When it comes to identity theft, the sooner you take action, the better. If you identify it in the early stages, you have a chance of minimizing the potentially disastrous impact. So, nothing exciting is a good thing to find on your credit report! You could see your credit report and your credit score for free before finishing this article by joining MoneyTips... and you should.
When examining your credit report, what are the sign that you’re a victim of identity theft? Here's what you need to look out for:
Personal Info
Check to make sure the personal information (like your name, address, birth date, and phone number) on your credit report is accurate. If the address is incorrect, there's a chance it's because a fraudster has changed it as part of an identity takeover scheme.
Of course, there's also a chance it's an honest mistake. Credit report errors are more common than you might think, which is another reason it's important to review your reports on the regular.
Priyanka Prakash, Lending and Credit Expert with Fundera explains: "A lot of people say that mistakes in your address or name are signs of identity theft. While this is true to a certain extent, don't jump to conclusions. Sometimes, the credit bureaus might make an honest mistake (for example, if there are siblings with similar names). If there's an honest mistake, you can follow the credit bureaus' standard dispute process for correcting errors."
Inquiries
Your credit report shows a record of hard credit inquiries made in your name, so you want to make sure there aren't any there that you didn't authorize. If there are, it might mean someone is applying for credit in your name and alarm bells should be ringing.
The good news is that if you catch it before a fraudulent credit account has actually been opened, you can stop the crook from going any further. Notify the bureaus and the creditor right away and consider initiating a credit freeze while they investigate.
Account Details
This one is the whopper. Are there accounts listed that you didn't open? Check opening dates and balances, and if anything looks out of place, contact the credit bureau and creditor immediately.
"A major sign is accounts you don't recall opening," says Jennifer McDermott, Consumer Advocate for personal finance comparison website finder.com. "Be meticulous in checking the details of every account listed, and if there are any that you don't recall, particularly those that are maxed out or overdue, it is a major red flag."
What if You Find Errors on Your Credit Report?
If you find anything on your credit report that doesn't quite add up, don't panic, but do act quickly.
"If consumers do detect something suspicious, they should inquire with the credit agency immediately and dispute errors," advises Jensen. "This is also a good time to do a detailed audit of all financial accounts and statements to see if you can identify fraudulent charges or a paper trail of sorts to help with your dispute and recovery."
If someone really has stolen your identity, they probably aren't finished. If they successfully opened one credit card, you can bet they'll try for a second (and third) one. That's why it's so important to act fast.
McDermott recommends considering a credit freeze to prevent further theft: "If you aren't planning on taking out a new loan or credit card in the near future, consider putting a credit freeze in place. A credit freeze is undoubtedly the biggest protection you can put in place for your credit. You will need to do so with all three credit reporting agencies: Equifax, Experian, and TransUnion. As of recently, placing a credit freeze is free."
What are you waiting for? Get your free credit report now and make reviewing it regularly part of your defense against fraud. Otherwise, you’re an accomplice to your own identity theft!
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