June 27, 2018
Shawn Lane
Consumer Credit Expert
Identity theft isn’t a 4-letter word, but it probably should be. If you have ever been a victim of identity theft then you are sure to agree. It is a scary unsettling crime, which can haunt you for many years, unless you take control of the situation.
What Is Identity Theft?
Identity theft occurs whenever someone steals your personal identifying information (e.g. name, address, social security number, date of birth, etc.) and then uses the information without permission to commit fraud. It is a crime that has become more and more common over recent years, aided in part by the many large-scale data breaches which seem to occur on practically a weekly basis.
Unfortunately, in addition to the stress it may cause you, identity theft can also have a horrible impact upon your credit. Until you clean up the effects of identity theft from your credit reports your scores will likely suffer and you may find it very difficult to qualify for new financing such as mortgages, auto loans, and credit cards.
The First Line of Defense
The first line of defense when it comes to identity theft is having a credit monitoring service. If you have credit monitoring, you will receive an email and/or text alert when there is a new credit application taken out in your name, any new accounts are added to your credit report, or any of your personal information changes. Credit monitoring lets you know about the problem long before you apply for new credit. There are dozens of good credit monitoring services, but be sure to choose a monitoring service that monitors all 3 credit bureaus and provides the ability to run a new credit report monthly, such as totalcreditscores.com.
Cleaning Up the Mess
If you discover that you have fraudulent accounts appearing on your credit reports, it is important for you to begin damage control immediately. The good news is that overcoming identity theft is entirely possible, though it may require some hard work on your part. For an extensive list of identity theft recovery steps, visit IdentityTheft.gov. In the meantime, here are 3 steps to help you get started.
1. Fraud Alerts or a Credit Freeze
The Fair Credit Reporting Act (FCRA) affords you some extensive rights in the event that you are a victim of identity theft. One such right is the ability to place free fraud alerts on your credit reports. When a fraud alert is present on your credit reports, any lender who pulls your credit is required to call you and verbally verify that the new credit application is indeed valid.
You only need to contact one credit bureau to place your free 90-day alert and the bureau you contact is responsible for telling the other 2 credit bureaus to add fraud alerts to your reports as well. Your initial 90-day fraud alerts can be extended to 7 years if you wish, with no fee. Yet in order to exercise this option you will need to provide an identity theft report to the credit bureaus.
An identity theft report can be filed with your local police department or the Federal Trade Commission (IdentityTheft.gov). If you want to protect your credit reports even further you might consider a credit freeze which prevents anyone from pulling your reports again unless you first “unlock” them. Most states have laws which require free credit freezes for victims of identity theft.
2. Review Your 3 Credit Reports
Once you discover or suspect that you have been a victim of identity theft, it is important to assess the full extent of the damage which has occurred. In order to accomplish this you will need to pull a copy of all 3 of your credit reports from Equifax, TransUnion, and Experian. You can access a free report from each credit bureau every 12 months from AnnualCreditReport. Or you can review your 3 reports from your credit monitoring company.
After downloading your 3 reports (less than 3 is not enough), go through each of them page-by-page and line-by-line. You should make a note of any accounts, inquiries, addresses, or other information, which you do not recognize. This list will be essential to the process of cleaning up the damage from your credit reports later.
3. Dispute Fraudulent Accounts
If you discover information on your credit reports which does not belong to you, the FCRA gives you the right to dispute this information with the 3 credit bureaus. In fact if you include an official identity theft report with your dispute, the credit bureaus must block the information from your credit reports within 4 business days.
Trying to clean up your credit after experiencing identity theft can be overwhelming, but the problem is too important and far too expensive for you to ignore. Although you have the right to try and clean up identity theft on your own, you also have the right to ask for help. Call 214-856-0068 today or CLICK HERE to schedule a free credit analysis with Financial Renovation Solutions to discuss your options and solutions.