The New Year is a Good Time to Review Your Credit Report

by Tolbert Rowe

2017 was a very interesting year for anyone over the age of 18 who voted. Not only was it the first year of the Trump Presidency, or as some have called it “The Ultimate Reality Show”, it was the year when men in positions of power were stripped of their influence over women. This reality show centered around an eccentric family of millionaires doing whatever it takes to enhance their franchise and own net worth while thumbing their noses at anyone who questions their actions. POTUS responds to any negative publicity as “fake news”.

If really upset and feeling violated, POTUS will resort to name calling as a last desperate attempt to make himself and family look good and the victim look bad. Supposedly, it is easier to elevate your own stature and net worth by tearing others down. Behavior not at all surprising for a businessman/TV personality who has spent his life taking advantage of smaller business owners who are too weak to go to war with his army of attorneys.

Before this gets branded as a political article, let me refocus on the issue at hand and the events of 2017 that signaled actions we must focus on in 2018 to protect our own personal financial situation.

What did become abundantly clear in 2017 was that our personal information and credit records are not safe from anyone. Much like the downfallen of men of desire and manipulation, everyones personal identities are at risk of being stolen and used by the violator for their own personal gain. We have become numb to the number of hackings reported by retailers and credit card companies, much as we have with mass killings in any place where more than a couple people gather.

The biggest, and I believe most significant hack job, was the one that potentially could affect as many as 143 million people. Absolutely the most horrific non-physical event that can occur to a person is the stealing of their identity, and the rampant misuse of their personal information to obtain credit and redirect bank account funds. The fact that Equifax, one of the three major repositories of our most personal financial information, allowed it to happen borders on what I consider to be criminal activity.

When Equifax admitted that the records of as many as 143 million people may have been hacked or stolen, many rushed to put a freeze on their credit. Fearing that they may become a victim of identity theft many people reacted aggressively and put a total freeze on their credit information. Blocking access to your credit with a freeze comes at a price and could be a tremendous inconvenience when you do want to apply for credit.

As we begin the year 2018 everyone should see what their credit looks like from all three repositories of information, Equifax, TransUnion and Experian. By law, all three repositories are required to provide one free credit report per year. Normally I recommend you get one from each of the repositories three to four months apart. That way you can monitor your credit all year for free in three to four month increments. Get one from Equifax in January, one from Transunion in April and one from Experian in August. It doesn’t matter when you get the report and from whom, just get it every three to four months from a different one than you requested previously.

Most, but not all creditors will report to all three repositories, so what you see in April on Transunion will be similar, with updated balances of course, as the one you received from Equifax in January. By doing this, you are able to see what is going on with your credit three times a year. Go to www.annualcreditreport.com and request your free report. This is the only site where you can go to get the mandated free annual report. Any other site, such as www.freeannualcreditreport.com is not free.

But, because of the Equifax breach, I suggest you get all three at the same time. You need to see what is showing on Equifax and compare with what is showing on the other two reports. This way you can easily identify incorrect information.

Keep in mind that I said that “at the very least” you need to “review” your credit to see where you are now. But this will only show what your credit looks like at this moment. It does not alert you when someone is inquiring or using your credit or new credit has been obtained. To “monitor” your credit means that anytime your credit file is accessed you will be alerted and confirmed if it is you. You are basically paying someone to act as a gate keeper of your credit every time your credit profile is accessed.

Most major credit card issuers will offer a credit monitoring service for a nominal fee or possibly even free. Many are also available on the internet, offering all kinds of additional services. Google “credit monitoring services” and you will quickly see pages and pages of companies offering the service. But if you are truly concerned about having your identity stolen you can subscribe to a service like Life Lock. For a monthly fee Life Lock will not only alert you anytime someone attempts to access your credit, but will provide a list of other important services protecting deposit and retirement accounts.

Once you have acquired your credit report you need to look at if very closely. First, review all open accounts to confirm that what is showing is indeed yours. If you do not recognize an open account as yours, immediately contact the creditor and have them do a social security number check to confirm that the account is not yours and have them remove it immediately, especially if you are a Junior or a Senior. Information is often shown on Juniors credit when it is really Seniors.

Next, review the payment history of accounts. The report you are looking at is showing all credit activity for the last seven years. A late payment you made on a car loan six years ago will show as a late payment, but will not have a significant impact on your credit score. Have a late payment on a revolving or installment debt in the last three to four months and you will see a drop in your credit score. The thinner your credit history, number of trade lines, or accounts, the more significant a late payment will be.

Public records are also reflected on your report. Judgments and collections will need to be paid if you are attempting to get a mortgage, and could, depending on the rest of your credit profile, keep you from acquiring credit from anyone. The goal is to avoid judgments and collections entirely.

Once you have confirmed that what is on your report is indeed yours and the information is true to the best of your knowledge, print out the report or save it as a pdf. The first report you acquire for monitoring purposes will be the one you use to validate all future information.
If you do not want to be proactive about monitoring your credit by regularly pulling your free credit report, then I suggest you pay for a monitoring service. Unfortunately, you are the only one who can take the initiative to safeguard your credit. The risk of identity theft is getting greater every day. When the records of 143 million people can be accessed from a credit repository it only shows how easy it may be for hackers to access this information from other sites.

Priority number one in 2018 is to take control to protect your identity. The cheapest way is to review your credit report through the annual credit report website.

The better way is to enroll in a credit monitoring service that alerts you when access to your credit is attempted, at a cost of course. But the money being spent can be the best peace of mind you could buy.

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