What Is Credit Monitoring?
Credit monitoring is the tracking of individuals' credit histories for any suspicious activity or changes. Credit monitoring helps individuals to detect credit related fraud and identity theft. Typically, identity theft protection companies or consumer credit scoring agencies will monitor individuals' credits for a fee, ranging anywhere from $43.80 to $150.00 a year depending upon the company. Individuals also have the option of monitoring their own credit by reviewing their free credit scores regularly.
Credit Monitoring Services
- IdentityTruth offers a credit monitoring service, included in their identity theft protection package, where they will monitor individuals' credit on a daily basis, and issue alerts to any credit history changes or updates. Their plans start at $17.99/month.
- Equifax offers individuals Credit Watch Gold with 3-in-1 Monitoring. They will alert individuals of key changes within 24 hours, and they will also protect individuals' credit. Their credit monitoring service is $12.95/month.
- IdentityGuard, as part of their plans, monitors individuals' credit daily for any changes to their credit histories. Individuals also have the option of subscribing to daily credit bureau monitoring with Equifax for $4.99/month.
How to Monitor Credit without a Service
Individuals who do not wish to pay credit monitoring fees may monitor their own credit by ordering and regularly reviewing their consumer credit scores from TransUnion, Experian and Equifax. Individuals may request a credit score from each of the credit bureaus at the same time and are able to view a complete picture of their consumer credit score history by analyzing all three credit scores simultaneously. Individuals also have the option of monitoring their consumer credit scores for accuracy by requesting a credit score from each of the credit bureaus individually, spaced four months apart. These are two effective and free methods of monitoring credit.
If individuals find any errors in their credit scores, they should contact all three credit bureaus in order to correct them. Once the three credit bureaus fix any errors, they should receive three amended reports within a week.
Individuals should also close any unused accounts that are still active on their credit scores, because unused accounts afford thieves an opportunities to steal individuals' identities. If individuals decide to close an account, they should make sure that it is listed as "closed at the request of the consumer."
Credit Monitoring Benefits
Credit monitoring helps to prevent credit fraud by presenting the opportunity to see all activity throughout the history of a credit score. If an individual receives a negative item on their credit scores, it can be detrimental to their future credit needs thus making credit monitoring that much more important. Credit monitoring allows individuals to rectify any negative items so that their future credit is not jeopardized. Credit monitoring also provides the opportunity to hinder fraud through early detection.
Credit Monitoring Disadvantages
Although credit monitoring offers a wide variety of advantages, it does not protect against the theft of other personal information. For instance, credit monitoring does not protect against the theft of social security numbers. Individuals who utilize credit monitoring services or personally monitor their credit scores will not discover any new accounts formed under their social security number.
Other credit monitoring disadvantages include gaps in monitoring and notification. Particularly, individuals and services are unable to detect sudden activity in dormant accounts, unexpected increases in balance levels, changes in existing documents, or the appearance of a negative public record. Some credit monitoring services take up to a week to report any changes.
Credit Monitoring Summary
Overall credit monitoring is an important tool to protect against credit fraud, and individuals should consider either monitoring their credit by themselves, or investing in a credit monitoring service. However, individuals need to be aware that credit monitoring will not provide a full proof way to protect against identity theft as well as the fact that there is a monitoring fee associated with this kind of service.