What is credit monitoring?
Credit Monitoring is the only automated method available to reduce the threat of identity theft and keep you up to date with changes and inquiries made to your credit file. Credit Monitoring alerts you of any major changes made to your credit file. Credit Monitoring does not affect your credit or credit score.
How do you alert me of changes in my credit file?
You will receive alerts of changes by email. These changes may signal potential identity theft in progress. Credit monitoring notifies you of any suspicious activity to your credit file - so you can take action quickly to minimize the damage.
What types of notifications/alerts will I be receiving?
The type of changes that you will be alerted of are the following:
I. New Accounts
II. Inquires
III. Derogatory information
IV. Public Records
V. Collection Accounts
VI. Serious Derogatory (foreclosure, bankruptcy)
VII. Change of Address
How do I view the changes made to my credit file once I receive an alert?
If you receive an email stating there has been a change to your credit file, log in to the member area either by visiting us at www.RunMyCreditReport.com or click on the link in the alert email. You will be taken directly to the member log in section. Once you have logged in, select the "View Monitoring History" link and a list of all recent and past alerts will be available for you to view.. ;
What happens if I change my email address?
If your email address changes, all you need to do is log into the member area, click on "modify personal info" and enter your new email address. Your email address will be updated immediately and you will continue to be notified of changes to your credit report. ;
Do I receive alerts for changes reported at all three repositories?
No. Currently your credit file is being monitored daily for changes based on your Experian Credit file, one of the three national credit bureaus.
Does the service monitor my wife's/husband's credit file as well?
No. Currently credit monitoring is on an individual basis. A spouse's credit file must be monitored separately.
Can you alert me via telephone or US mail instead of email?
Currently, you can only be notified of changes to your credit file via email. This is to ensure prompt notification in the event of a significant change to your credit file.
My credit is in really poor shape; do I still need to monitor it?
Whether you have bad credit or good credit, identity theft affects your personal credit, and it can lead to a wide range of long-term financial problems making poor credit even worse. Identity theft occurs when someone uses your name, credit card number, or other personal information to make unauthorized purchases or open new accounts in your name. Changes and inaccuracies in your credit file can be an early warning sign of identity theft. Regularly checking and monitoring your credit can be a good way to stop any problems before they get too far.
Learn more at
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
Tuesday, August 14, 2007
PERSONAL EVENTS
Marriage
Managing your credit can be tricky, even when you're the only person involved in your financial decisions. Add a new spouse to the mix, and you have to be extra careful to ensure your credit remains in good standing. For many engaged couples, talking about finances takes a back seat to the excitement of wedding planning. But, before saying "I do," you need to be aware of the credit issues that could arise with a new marriage.
First of all, both you and your spouse should put all your financial records - savings, salaries, investments, real estate, and especially credit - on the table. If one of you has a less-than-glowing credit history, it will affect the other as soon as you start applying for credit together and opening joint accounts. In addition, your new joint accounts will appear on both spouses' credit reports in the future, so be sure to pay careful attention to your bills and pay them on time.
Once you've aired your credit laundry, you'll need to decide whether or not to merge all of your financial accounts. Many couples do this because consolidated accounts often make for easier record keeping. Just remember, both of you are responsible for all debt incurred in any joint credit accounts. So, regardless of who's incurring debt, a missed payment on a joint account will negatively affect both of your records. The same is true in community property states, where virtually any debt entered into during marriage is automatically considered joint. Consider also if you miss a payment on an individual account, that payment may very well impact your ability to open joint accounts because both credit histories will be considered.
The best way to keep your record clean starts with a solid understanding of the terms of your joint accounts. That means paying attention to interest rates, credit limits, annual or late payment fees and cash advance limits. If you decide to consolidate your accounts, you might want to keep at least one credit account in your own name as a safeguard in the event of an emergency. Keeping an individual account can also be a good thing in the event of divorce to reestablish an individual credit history.
Women who take their husband's surname after getting married need to notify the Social Security Administration and their current creditors of this change. You do not need to notify the credit reporting agencies of a name change. They will automatically update the name on a credit report when creditors report it.
The key to successful credit management as a couple is understanding that your individual credit behavior affects both you and your partner. To ensure that you are able to quickly get credit at the best possible terms, be sure you both understand all the implications that accompany a joint account. In addition, consider how the payments stemming from a major credit purchase will affect your overall budget.
Divorce
With divorce and separation come new experiences and responsibilities. Suddenly words like "child support payments" and "100 percent liable for bills" enter the picture. If you ignore your increased financial obligations or fail to separate your accounts, it may be hard to open new accounts and obtain new loans in your name. But there are many moves you can make to protect and restore the good credit that took years to build.
Get your credit report
Before you begin, get an idea of what your credit report looks like. Get immediate online access to your RMCR credit report and Score.
Protect your good credit
Your divorce decree does not relieve you from joint debts you incurred while married. You are responsible for joint accounts, from credit cards and car loans to home mortgages. Even when a divorce judge orders your ex-spouse to pay a certain bill, you're still legally responsible for making sure it is paid because you promised - both as a couple and as individuals - to do so.
The credit grantor (a bank, credit card issuer, mortgage company or other credit-lending business) also has a legal right to report negative information to a credit reporting agency if your ex-spouse pays late on a joint account. If your ex-spouse doesn't pay at all, you'll probably have to pay - or the grantor can take legal action against you.
Start small and build up. Get a credit card that has a small credit limit, perhaps from a local department store or financial institution. Then always pay your bills on time so your credit history will be excellent. After six months, apply for another card and continue paying bills consistently. Don't run your debt up beyond what you can afford to pay. It's a winning strategy that's easy to master.
Ask a family member or friend to cosign. Perhaps a relative or friend with an established credit history can cosign your loan or credit application - provided you repay that cosigned debt on time. Remember, any transaction also will show up on the cosigner's credit profile. After a few months, try again to get credit on your own.
Consider applying for a secured credit card. You must open and maintain a savings account as security for your line of credit. Your credit line is a percentage of your deposit. Beware of the extra fees you may have to pay for secured credit.
Rebuild positive credit history
You can pick up your pieces and start fresh with a positive credit report - if you pay your bills on time. After all, your credit profile is always evolving.
Bankruptcy should be the last move to make if you get in over your head.
Mediation can make things much fairer by helping you and your ex-spouse work out a reasonable and equitable divorce agreement. If you'd like help finding a mediator, contact the American Arbitration Association. To locate an attorney, check with your state or local Bar Association.
Death of a spouse
If you've lost a spouse, you're already going through one of the most emotionally draining experiences possible. When a loved one dies, there are also numerous financial matters to deal with, including credit and debt issues. There are, however, some simple steps you can take now to help down the road.
Stabilizing your credit in the event of a death can be difficult, especially if your spouse held all of the credit in his or her name. Keep in mind that in community property states, credit accounts opened during marriage are automatically joint. That means you are still responsible for any debt that your deceased spouse incurred.
By law, a creditor cannot automatically close a joint account or change the terms because of the death of one spouse. Generally, the creditor will ask the survivor to file a new credit application in his or her own name. After reviewing the new information, the creditor will then decide to continue to extend credit or alter the credit limit. You might want to open a new credit account in your name. In doing so, keep in mind that you must use your name only when applying. Including your deceased spouse's name will result in a joint account. Credit Reporting Agencies automatically update its records with periodic reports from the Social Security Administration. When the update is made, your spouse's credit history will be flagged to show that he or she has passed away and their name will be removed from any preapproved credit offer mailing lists.
Learn more at
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
Managing your credit can be tricky, even when you're the only person involved in your financial decisions. Add a new spouse to the mix, and you have to be extra careful to ensure your credit remains in good standing. For many engaged couples, talking about finances takes a back seat to the excitement of wedding planning. But, before saying "I do," you need to be aware of the credit issues that could arise with a new marriage.
First of all, both you and your spouse should put all your financial records - savings, salaries, investments, real estate, and especially credit - on the table. If one of you has a less-than-glowing credit history, it will affect the other as soon as you start applying for credit together and opening joint accounts. In addition, your new joint accounts will appear on both spouses' credit reports in the future, so be sure to pay careful attention to your bills and pay them on time.
Once you've aired your credit laundry, you'll need to decide whether or not to merge all of your financial accounts. Many couples do this because consolidated accounts often make for easier record keeping. Just remember, both of you are responsible for all debt incurred in any joint credit accounts. So, regardless of who's incurring debt, a missed payment on a joint account will negatively affect both of your records. The same is true in community property states, where virtually any debt entered into during marriage is automatically considered joint. Consider also if you miss a payment on an individual account, that payment may very well impact your ability to open joint accounts because both credit histories will be considered.
The best way to keep your record clean starts with a solid understanding of the terms of your joint accounts. That means paying attention to interest rates, credit limits, annual or late payment fees and cash advance limits. If you decide to consolidate your accounts, you might want to keep at least one credit account in your own name as a safeguard in the event of an emergency. Keeping an individual account can also be a good thing in the event of divorce to reestablish an individual credit history.
Women who take their husband's surname after getting married need to notify the Social Security Administration and their current creditors of this change. You do not need to notify the credit reporting agencies of a name change. They will automatically update the name on a credit report when creditors report it.
The key to successful credit management as a couple is understanding that your individual credit behavior affects both you and your partner. To ensure that you are able to quickly get credit at the best possible terms, be sure you both understand all the implications that accompany a joint account. In addition, consider how the payments stemming from a major credit purchase will affect your overall budget.
Divorce
With divorce and separation come new experiences and responsibilities. Suddenly words like "child support payments" and "100 percent liable for bills" enter the picture. If you ignore your increased financial obligations or fail to separate your accounts, it may be hard to open new accounts and obtain new loans in your name. But there are many moves you can make to protect and restore the good credit that took years to build.
Get your credit report
Before you begin, get an idea of what your credit report looks like. Get immediate online access to your RMCR credit report and Score.
Protect your good credit
Your divorce decree does not relieve you from joint debts you incurred while married. You are responsible for joint accounts, from credit cards and car loans to home mortgages. Even when a divorce judge orders your ex-spouse to pay a certain bill, you're still legally responsible for making sure it is paid because you promised - both as a couple and as individuals - to do so.
The credit grantor (a bank, credit card issuer, mortgage company or other credit-lending business) also has a legal right to report negative information to a credit reporting agency if your ex-spouse pays late on a joint account. If your ex-spouse doesn't pay at all, you'll probably have to pay - or the grantor can take legal action against you.
- Close or separate joint accounts. If you can talk to your ex-spouse, you can save a lot of grief. Analyze all your debts and decide who should be responsible for each. Call your creditors and ask them how to transfer your joint accounts to the person who is solely responsible for payments. However, you still might have legal responsibility to pay existing balances unless the creditor agrees to release you from the debt.
- Take stock of your properties. You may have to refinance your home to get one name off the mortgage. Or you might need to sell your home and divide the proceeds.
- Keep paying all bills. Until you can separate your accounts, neither of you can afford to miss a turn paying bills. During divorce negotiations, send in at least the minimum payment due on all joint bills. Miss even one payment and it stays on your credit profile for up to seven years, making it hard to obtain new credit in your own name. Beware of well-meaning friends and relatives who may tell you to ignore making payments or to run up debts. Always make all payments with at least the minimum due.
Start small and build up. Get a credit card that has a small credit limit, perhaps from a local department store or financial institution. Then always pay your bills on time so your credit history will be excellent. After six months, apply for another card and continue paying bills consistently. Don't run your debt up beyond what you can afford to pay. It's a winning strategy that's easy to master.
Ask a family member or friend to cosign. Perhaps a relative or friend with an established credit history can cosign your loan or credit application - provided you repay that cosigned debt on time. Remember, any transaction also will show up on the cosigner's credit profile. After a few months, try again to get credit on your own.
Consider applying for a secured credit card. You must open and maintain a savings account as security for your line of credit. Your credit line is a percentage of your deposit. Beware of the extra fees you may have to pay for secured credit.
Rebuild positive credit history
You can pick up your pieces and start fresh with a positive credit report - if you pay your bills on time. After all, your credit profile is always evolving.
- Your recent bill-paying pattern is critical. Your behavior (during the next 18-24 months) is most important in deciding whether you're a good credit risk. Even one late payment can affect your ability to get a mortgage.
- Help is available if you're having difficulty paying bills. The nonprofit National Foundation for Credit Counseling (NFCC), 1-800-388-2227, can help you establish a budget and repay creditors. Other organizations offer quality credit counseling as well. Be sure the organization you work with is non-profit and provides budgeting and financial management training in addition to any debt management plan, and does so at little or no cost. Be very cautious of any organization that claims it can provide a quick fix to your credit problems, provides you with no financial management education, or that charges substantial fees for its services.
Bankruptcy should be the last move to make if you get in over your head.
- It's not an easy way out. Filing for bankruptcy is no guarantee that it will be granted because a court judgment must be made. Even if all you do is file your bankruptcy papers with the court, it gets reported on your credit profile.
- Not all debts are included in bankruptcy. Things like alimony, child support, student loans and taxes secured by liens still must be paid consistently.
- Bankruptcy remains on your credit history up to 10 years. While a declaration of bankruptcy removes many debts, any reference to filing, dismissal or discharge still appears on your credit history for up to 10 years. During this time, you'll find it more difficult if not impossible to get a new mortgage, personal loan or a credit card.
Mediation can make things much fairer by helping you and your ex-spouse work out a reasonable and equitable divorce agreement. If you'd like help finding a mediator, contact the American Arbitration Association. To locate an attorney, check with your state or local Bar Association.
Death of a spouse
If you've lost a spouse, you're already going through one of the most emotionally draining experiences possible. When a loved one dies, there are also numerous financial matters to deal with, including credit and debt issues. There are, however, some simple steps you can take now to help down the road.
Stabilizing your credit in the event of a death can be difficult, especially if your spouse held all of the credit in his or her name. Keep in mind that in community property states, credit accounts opened during marriage are automatically joint. That means you are still responsible for any debt that your deceased spouse incurred.
By law, a creditor cannot automatically close a joint account or change the terms because of the death of one spouse. Generally, the creditor will ask the survivor to file a new credit application in his or her own name. After reviewing the new information, the creditor will then decide to continue to extend credit or alter the credit limit. You might want to open a new credit account in your name. In doing so, keep in mind that you must use your name only when applying. Including your deceased spouse's name will result in a joint account. Credit Reporting Agencies automatically update its records with periodic reports from the Social Security Administration. When the update is made, your spouse's credit history will be flagged to show that he or she has passed away and their name will be removed from any preapproved credit offer mailing lists.
Learn more at
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
MAJOR PURCHASES
Buying a home
Home buying can be complicated and stressful, but if you plan carefully, buying your dream home can become more fun and less work for the entire family. Following these steps can help make your dream a reality.
Get your credit report
Before approving your request for a home loan, mortgage lenders review your credit report. In fact, they often get your report from two or more credit reporting companies to be sure they have your complete credit history.
If you review your credit report in advance, you'll see yourself from a lender's perspective. That can help you avoid possible loan approval delays.
Be prepared
When mortgage lenders review your credit report, they evaluate how much you already owe, how much unused credit you have available, how prompt you are in paying your debts and whether you've recently applied for new credit. They may ask you to explain any late payments, recent inquiries on your credit report or new accounts. If you have no credit accounts, they may ask you to show that you pay your rent, telephone bills or utility payments on time.
Count your savings
Have you saved enough money? You generally need a down payment of at least five percent of your new home's purchase price. You also need money for closing costs.
But that's not all. Be sure to set aside extra funds for emergencies. If you spend every dime on your down payment, you're statistically more likely to lose your new home to foreclosure some time in the future.
Seek preapproval
Touring homes you can't afford makes homes in your price range pale in comparison. Asking a mortgage lender to prequalify (or preapprove) you for a specific loan amount narrows your search, helps you avoid disappointment, improves your bargaining power and speeds the sales process.
Know your options
Ask the lender to give you details on the cost differences of various mortgage plans. Then select the one that's best for you. Options include:
Home buying can be complicated and stressful, but if you plan carefully, buying your dream home can become more fun and less work for the entire family. Following these steps can help make your dream a reality.
Get your credit report
Before approving your request for a home loan, mortgage lenders review your credit report. In fact, they often get your report from two or more credit reporting companies to be sure they have your complete credit history.
If you review your credit report in advance, you'll see yourself from a lender's perspective. That can help you avoid possible loan approval delays.
Be prepared
When mortgage lenders review your credit report, they evaluate how much you already owe, how much unused credit you have available, how prompt you are in paying your debts and whether you've recently applied for new credit. They may ask you to explain any late payments, recent inquiries on your credit report or new accounts. If you have no credit accounts, they may ask you to show that you pay your rent, telephone bills or utility payments on time.
Count your savings
Have you saved enough money? You generally need a down payment of at least five percent of your new home's purchase price. You also need money for closing costs.
But that's not all. Be sure to set aside extra funds for emergencies. If you spend every dime on your down payment, you're statistically more likely to lose your new home to foreclosure some time in the future.
Seek preapproval
Touring homes you can't afford makes homes in your price range pale in comparison. Asking a mortgage lender to prequalify (or preapprove) you for a specific loan amount narrows your search, helps you avoid disappointment, improves your bargaining power and speeds the sales process.
Know your options
Ask the lender to give you details on the cost differences of various mortgage plans. Then select the one that's best for you. Options include:
- Fixed-rate mortgages for 15, 20 or 30 years
- Adjustable-rate mortgages
- Balloon mortgages
- Government-insured loans or special loan programs.
Remember, besides your mortgage payment and property taxes, your monthly housing costs can include mortgage insurance, home insurance, special assessments and homeowners fees.
As a general rule, your housing costs should total no more than 28-32 percent of your monthly income before taxes. Add other long-term debts such as car and student loans, and your total should take no more than 36-41 percent of your monthly income before taxes.
Narrow your choices
This is not just a house, it's your home. It's where you live. More than that, your home gives you pride of ownership, freedom from landlords and a sense of security. That's why it's a good idea to consider more than finances before buying. Think, too, about your needs and preferences for:
- Schools and transportation
- Healthcare
- Recreational opportunities
- Commute to work
- Housing styles and lot sizes
Make your payments
How much you borrow, how much you owe and when you pay become a part of your credit history. When you apply for new loans or credit cards, other lenders will review this history.
Late payments can stay on your credit report for up to seven years, can keep you from buying another house or can make it more expensive to buy a car. A good credit history proves you manage your finances well. It lets you enjoy using credit at your convenience and at a lower cost.
Buying a car
No one wants to drive away in a dream car only to find he's heading toward unwanted sacrifices. More than one consumer has bought an expensive automobile or truck and then found that he couldn't afford to put gas in its tank.
The prudent consumer can avoid this situation by reading and understanding the fine print of automobile purchases, and weighing the benefits and drawbacks of both purchasing and leasing a vehicle. Here are some identifiers in support of buying a car:
- You have the money for the down payment that's required for your purchase
- You like the idea of owning something of value after making payments for years
- You want to trade in an old vehicle
- You like the idea of carefully maintaining your car, so that it runs perfectly for years and years
- You drive tens of thousands of miles each year (if you lease, you might end up paying a relatively large amount of money at the lease's end for exceeding the annual mileage cap, which is generally 12,000 to 15,000 miles).
- You generally prefer lower monthly payments
- You like driving a new vehicle - particularly a luxury model - every two or three years
- You hate the hassle of selling your old car every time you want to buy a new one
- You put "hard" miles on your vehicle
- You like the idea of driving a vehicle for a few years before purchasing it
If you decide to lease, you need to learn exactly what you're paying for in terms of interest rate (it should be close to the current automobile loan rate). You should negotiate the capitalized cost (the price the financial institution pays the dealer for the leased vehicle), the acquisition fee (which the consumer is charged for initiating the lease) and the disposition fee (which the consumer is charged at lease's end if he decides not to buy the vehicle.). Because of all of these factors, professionals advise that low monthly payments don't necessarily translate into a beneficial transaction for the consumer.
Financing a new business
The success of a new small business largely depends on the creditworthiness of its owner. Whether the office needs more equipment or the employees need more training, it's the owner's responsibility to foot the bill.
Some owners turn to investors for the capital, but many others will secure a loan or a line of credit from a bank. Others simply use their own personal credit cards or a combination of these types of credit. Savvy small business owners will try to find lower interest rates on small business loans rather than the increased cost of using a personal credit card.
Unlike the unsecured credit cards, small business loans generally need to be secured by assets, namely property or goods. You'll also need to calculate the actual cost of the loan, and decide if you're comfortable living with some of the imposed restrictions (such as caps on your salary). To secure a loan, you will probably need to submit a precise business plan, tax returns, balance sheets, income statements and credit history - as well as additional documentation - to the loan officials. Considering about 80 percent of new businesses collapse within three years, it's easy to see why lenders are reluctant to finance new businesses. If securing a bank loan is indeed not a possibility for you and your business, you can always turn to your personal or business credit card to finance your entrepreneurial dreams. But always keep sight of the risks.
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
BUILDING CREDIT
Risks and rewards
There are many rewards for handling your credit well. You may be able to improve your lifestyle through purchases that are only possible with credit, utilize services that are only available if you have a credit card - renting a car for example - and have the resources to pay for unexpected emergencies.
However, there are risks. Poorly managed credit can land you deeply in debt, and recovery is not easy. The rules of credit are few and simple. A lender extends you a line of credit. You agree to pay the lender back the amount you spend plus finance charges and perhaps additional service fees. A payment schedule is set up and you are required to make payments according to that schedule. The most important advice is, pay your bills on time!
Types of credit available
Revolving credit: Most credit cards are a form of revolving credit. This simply means you are given a maximum credit limit and you can make charges against that limit, carrying a balance and making payments each month.
Charge cards: While they often look like revolving credit cards and are used the same way, charge accounts differ in that you must pay the total balance each month.
Service credit: Often overlooked, your agreements with service providers are all credit arrangements. You receive goods (natural gas, electricity) or services (apartment rental, cellular phone use, health club memberships) with the agreement that you will pay for them each month just as you would with any other form of credit. Your contract may require payments for a specified number of months, even if you stop using the service. Your accounts with service providers and the associated payment history are appearing more commonly on credit reports. Unpaid bills are almost always reported when the account is turned over to a collection agency.
Installment credit: Car loans and mortgages are two examples. Installment credit is among the most common and easily understood. A creditor loans you a specific sum of money and you agree to repay the money and interest in regular installments of a fixed amount over a set period of time, usually measured in months or years.
Using credit
Getting your first line of credit sometimes can be challenging. Without a credit history, or with a serious blemish like bankruptcy, lenders may be reluctant to extend you credit. You may want to talk to a local department store or bank. Ask if they will open a line of credit for you, for perhaps only $200 or $300.
It may be necessary to have a parent or friend with a strong credit history cosign for you. If a person cosigns on your behalf, they are accepting equal responsibility for the loan or credit line. Without someone to cosign, you may need to begin with a secured line of credit. To do so, you must open an account with a bank or other lending institution. In turn, you will receive a line of credit with a limit equal to a percentage of your bank account balance. Often, this type of credit has higher interest rates and fees, but it may be a good way to get your first credit card.
Tips for using credit
When you are extended a line of credit, use it, but use it carefully. Be certain your account is reported to a credit reporting agency. Most importantly, make your payments on time.
Learn more at
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
There are many rewards for handling your credit well. You may be able to improve your lifestyle through purchases that are only possible with credit, utilize services that are only available if you have a credit card - renting a car for example - and have the resources to pay for unexpected emergencies.
However, there are risks. Poorly managed credit can land you deeply in debt, and recovery is not easy. The rules of credit are few and simple. A lender extends you a line of credit. You agree to pay the lender back the amount you spend plus finance charges and perhaps additional service fees. A payment schedule is set up and you are required to make payments according to that schedule. The most important advice is, pay your bills on time!
Types of credit available
Revolving credit: Most credit cards are a form of revolving credit. This simply means you are given a maximum credit limit and you can make charges against that limit, carrying a balance and making payments each month.
Charge cards: While they often look like revolving credit cards and are used the same way, charge accounts differ in that you must pay the total balance each month.
Service credit: Often overlooked, your agreements with service providers are all credit arrangements. You receive goods (natural gas, electricity) or services (apartment rental, cellular phone use, health club memberships) with the agreement that you will pay for them each month just as you would with any other form of credit. Your contract may require payments for a specified number of months, even if you stop using the service. Your accounts with service providers and the associated payment history are appearing more commonly on credit reports. Unpaid bills are almost always reported when the account is turned over to a collection agency.
Installment credit: Car loans and mortgages are two examples. Installment credit is among the most common and easily understood. A creditor loans you a specific sum of money and you agree to repay the money and interest in regular installments of a fixed amount over a set period of time, usually measured in months or years.
Using credit
Getting your first line of credit sometimes can be challenging. Without a credit history, or with a serious blemish like bankruptcy, lenders may be reluctant to extend you credit. You may want to talk to a local department store or bank. Ask if they will open a line of credit for you, for perhaps only $200 or $300.
It may be necessary to have a parent or friend with a strong credit history cosign for you. If a person cosigns on your behalf, they are accepting equal responsibility for the loan or credit line. Without someone to cosign, you may need to begin with a secured line of credit. To do so, you must open an account with a bank or other lending institution. In turn, you will receive a line of credit with a limit equal to a percentage of your bank account balance. Often, this type of credit has higher interest rates and fees, but it may be a good way to get your first credit card.
Tips for using credit
When you are extended a line of credit, use it, but use it carefully. Be certain your account is reported to a credit reporting agency. Most importantly, make your payments on time.
- Set up a budget and stick to it. You need to be aware of how much debt you already have and how much you are adding to that debt by buying with credit.
- Shop around for credit. Lower interest rates, lower or no annual fees, cheaper service charges and additional benefits such as frequent flyer miles or special insurance rates are available. Find the credit that is right for you.
- Once you have signed a credit agreement, you are responsible for it unless the creditor agrees to release you from the agreement. That not only includes credit cards or installment loans, but also health club agreements and cellular telephone contracts, even if you stop using the service. Remember also that a divorce decree does not release you from responsibility for joint accounts.
- Protect yourself from credit fraud. Treat your credit cards like cash. Sign them as soon as you get them. Don't leave them lying around. Shred receipts that have your account number on them and do the same with credit offers you receive in the mail but choose not to accept.
Learn more at
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
VICTIM ASSISTANCE PROCESS
If you have reason to believe that you are a victim of fraud, Credit Reporting Agencies can assist you in your efforts to protect your credit.
Step 1: Consumer contacts National Consumer Assistance Center
Credit Reporting Agencies must complete an investigation within 30 days. If the data contributor cannot verify information as accurate within the statutory deadlines, Credit Reporting Agencies systems are designed to delete or update the information.
Learn more at
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
Step 1: Consumer contacts National Consumer Assistance Center
- Consumers can call the Credit Repoting Agencies, 24 hours a day, seven days a week, 365 days each year.
- A 90-day security alert is immediately added to the consumer's credit file. This alerts creditors to confirm the consumer's identity before extending credit.
- The consumer's name is removed from prescreened credit solicitation lists as an additional precaution.
- The consumer is provided a complimentary consumer report.
Step 2: Consumer receives reports
- The consumer reviews his or her consumer disclosure for fraudulent data and calls a special telephone number listed on the credit report to speak with a consumer assistance associate specially trained in fraud victim assistance.
- Together, the consumer and the consumer assistance associate identify fraudulent items. Some items are removed immediately; others must be investigated and verified.
Step 3: Investigation begins
Credit Reporting Agencies verify the information that the consumer alleges as fraudulent with the creditors or data furnishers.
- Upon receipt of a valid police report, Credit Reporting Agencies block alleged fraudulent information from view by creditors and other users of the report. This allows a victim to continue to be credit active without being penalized for any fraudulent information on his or her report.
- Credit Reporting Agencies employ special system procedures and matching criteria to ensure that fraudulent data is removed as soon as possible.
Credit Reporting Agencies must complete an investigation within 30 days. If the data contributor cannot verify information as accurate within the statutory deadlines, Credit Reporting Agencies systems are designed to delete or update the information.
Learn more at
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
PREVENTING CREDIT FRAUD & IDENTITY THEFT
It's unfortunately not possible to prevent identity theft and credit fraud entirely. But by managing your personal information carefully, and with a full understanding of its importance, you can substantially reduce the likelihood that it will happen to you. The following tips show you how.
How to Outsmart Identity Thieves
Be careful about giving out personal information. Whether on the phone, by mail, or on the Internet, never give anyone your card number, Social Security number, or other personal information for a purpose you don't understand. Ask to use other types of identifiers when possible, and don't carry your SSN card. Be sure to keep it in a secure place.
Protect your mail. To stop a thief from going through your through trash or recycling bin to get your personal information, tear or shred your charge receipts, credit applications, insurance forms, bank statements, expired charge cards, and preapproved credit offers. Deposit outgoing mail in post office collection boxes or at your local post office. Promptly remove mail from your mailbox after it's delivered. If you plan to go away, call the U.S. Postal Service at 800-275-8777 and request a vacation hold.
Guard your credit cards. Minimize the information and the number of cards you carry in your wallet. If you lose a card, contact the fraud division of the credit card company. If you apply for a new credit card and it doesn't arrive in a reasonable period, contact the issuer. Watch cashiers when you give them your card for a purchase. Also, when you receive a new card, sign it in permanent ink and activate it immediately.
Pay attention to billing cycles. Contact creditors immediately if your bills arrive late. A missing bill could mean an identity thief has taken over your credit card account and changed your billing address.
Learn more at
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
How to Outsmart Identity Thieves
Be careful about giving out personal information. Whether on the phone, by mail, or on the Internet, never give anyone your card number, Social Security number, or other personal information for a purpose you don't understand. Ask to use other types of identifiers when possible, and don't carry your SSN card. Be sure to keep it in a secure place.
Protect your mail. To stop a thief from going through your through trash or recycling bin to get your personal information, tear or shred your charge receipts, credit applications, insurance forms, bank statements, expired charge cards, and preapproved credit offers. Deposit outgoing mail in post office collection boxes or at your local post office. Promptly remove mail from your mailbox after it's delivered. If you plan to go away, call the U.S. Postal Service at 800-275-8777 and request a vacation hold.
Guard your credit cards. Minimize the information and the number of cards you carry in your wallet. If you lose a card, contact the fraud division of the credit card company. If you apply for a new credit card and it doesn't arrive in a reasonable period, contact the issuer. Watch cashiers when you give them your card for a purchase. Also, when you receive a new card, sign it in permanent ink and activate it immediately.
Pay attention to billing cycles. Contact creditors immediately if your bills arrive late. A missing bill could mean an identity thief has taken over your credit card account and changed your billing address.
Learn more at
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
WHAT IS CREDIT FRAUD?
In a country where consumers owe more than $1 trillion on their credit cards, estimates of $2 billion to $3 billion in credit card fraud losses may not seem all that terrible. That comes out to just two to three one-thousandths of one percent. But it is terrible to victims of fraud. Though they may be protected financially, they are forced to endure major inconvenience. Additionally, we all pay for the costs of fraud in the form of higher prices, higher interest rates and increased inconvenience.
There is no single definition of fraud, but some types of credit fraud that occur include:
Just as there are various types of credit fraud, there are also different ways that credit thieves gather your personal information:
There are several warning signs that credit fraud may be occurring:
Learn more at
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
There is no single definition of fraud, but some types of credit fraud that occur include:
- Identity theft: the unauthorized use of personal identification information to commit fraud or other crimes
- Identity assumption: long-term victimization of identification information
- Fraud spree: unauthorized charges on existing accounts
Just as there are various types of credit fraud, there are also different ways that credit thieves gather your personal information:
- Using lost or stolen credit cards
- Stealing from your mailbox
- Looking over your shoulder
- Going through your trash
- Sending unsolicited email
- False telephone solicitation
- Looking at personnel records
There are several warning signs that credit fraud may be occurring:
- Your credit report contains inquiries or information about accounts that you did not open
- Strange charges show up on billing statements
- Bills arrive from unknown or unfamiliar sources
- You receive calls from creditors or collection agencies
Learn more at
SeeYourFreeCreditReport.com
RestoreMyCreditReport.com
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