• View

Credit Report Monitoring: How to Keep an Eye on Your Credit Score


Monitoring Credit Score and Report

Simple Ways to Keep an Eye on Your Credit

In the wake of the Equifax data breach, many Americans are worried about their credit.  Will someone use your identity to get loans?  The fact that there are completely different tips from different sources makes things even more confusing.

In any situation where you feel insecure about your credit and identity, it's a good idea to step back, take a break, and get back to the basics of simply monitoring your credit.  Managing your credit is not only a great way to make sure identity thieves stay away, but it also helps ensure that you can get loans when you need them, qualify for lower insurance rates, and qualify for another loan.  Small benefits that come with good credit.

Here are four steps you can take to control your balance and make sure it's healthy.

Keep paying your bills and don't let your credit card balances grow.  Believe it or not, your regular bills are one of the strongest windows on your credit.  Simply keeping your bills current and not carrying a large balance on your credit cards (small balances are fine) is enough to ensure your credit is in good shape, as these two factors are critical components in determining your credit score. .

This part is as simple as possible.  Just keep your bills paid and don't fall behind on them.  If you can't pay off your credit cards in full, be sure to make at least the minimum payments and keep your balance well below your credit limit.

If you can do this, you're guaranteed to have a solid credit foundation, regardless of any mishaps or anything else that happens, because these things can usually be fixed.  For starters, having strong credit makes it easier to identify and fix real credit problems and recover from those problems.

Get your free annual credit report every year and review it.  The Fair Credit Reporting Act requires each of the three major credit bureaus to provide a free copy of your credit report each year upon request.  These credit reports provide a firsthand look at your credit and can help you quickly determine whether or not you have incorrect marks on your credit report that are lowering your score.

Here's the rub: A lot of companies have jumped on that bandwagon and bundled your actual free credit report with a bunch of their paid services that you don't need and probably don't even want.

The only place approved by the Federal Trade Commission to provide you with your credit report directly for free is annualcreditreport.com.  On this site, you can access your credit report from each of the three credit reporting agencies each year and see for yourself what information it contains.

It's a good idea not to access all three at once.  Instead, review your report from one bureau, return four months later to review your report from a second bureau, and return four months later to review your report from a third bureau.  After that, you can go back to the beginning.  All of these reports are free;  It's your right as a citizen, so take advantage of it.

If you find something wrong on your credit report, keep it posted.  Contact the business or organization that posted the incorrect information and see what they can do to fix it.

Review your bank statements and credit card transactions.  Another nefarious way your credit can be affected by identity theft is if a hacker gains access to your credit card or bank account (often through a debit card).  Often the hacker will perform microtransactions through this account that will not raise any red flags and will not go unnoticed unless you pay attention.

The best way to spot this is to sit down with your credit card and monthly bank statements and go through them transaction by transaction.  If you see transactions you can't identify, spend some time finding out what they are.  Contact your bank or credit card company and ask about that transaction in detail.

If you find transactions you didn't authorize, cancel your card and get a new card issued for the account.  It is possible that someone has unauthorized access to the account through your card.  If it's a bank account, talk to your bank about reasonable next steps to take, as the hack can affect other accounts and not necessarily involve your card.

Ask about your credit score when you actually use your credit.  Many people like to know their credit score, as it is a good description of an individual's relative credit health.  Unfortunately, many of the services that let you see your credit score show estimates or bundle it with expensive packages.

One way to avoid this is to simply ask to see your credit score when you are in a situation where your credit score can be accessed or calculated, such as when applying for a loan at a bank or credit union.  Often the financial institution will share this information with you at the end of your application review process.

Credit scores are not necessary information, but they do provide a useful summary of your credit history.  If your score is lower than you expected, you know it's time to start doing some financial detective work.

Monitoring your credit does not have to be a full-time job, nor does it have to be an expensive process.  Most of the tools you need are free and readily available.  The main part of the equation is you: you have to sit down, go through those reports and see if something is not right.  good luck.

Contact Form