Credit monitoring is a service that helps you keep track of your credit reports and alerts you to any changes that may affect your credit score. This service is offered by various companies and credit bureaus and typically involves regular monitoring of your credit reports from one or more of the major credit bureaus.
Credit monitoring may include features such as alerts for new credit inquiries, changes in credit utilization, or new accounts opened in your name. Some credit monitoring services may also provide identity theft protection and resolution services, which can help you quickly address any fraudulent activity on your credit reports.
Credit monitoring can be helpful for anyone who wants to keep a close eye on their credit and detect any potential issues early on. It can also be particularly useful for those who have experienced identity theft or fraud in the past and want to take proactive steps to protect themselves.
How Does Credit Monitoring Work?
Credit monitoring works by monitoring your credit reports for any changes or suspicious activity that could affect your credit score. This is typically done by a credit monitoring service, which may be offered by a credit bureau, financial institution, or third-party provider.
When you sign up for a credit monitoring service, you will typically provide your personal information and authorize the service to access your credit reports from one or more of the major credit bureaus (Equifax, Experian, and TransUnion). The service will then monitor your credit reports on an ongoing basis and alert you to any changes or activity that could be a sign of fraud or identity theft.
Credit monitoring alerts can be delivered via email, text message, or mobile app notifications, depending on the service you choose. Common types of alerts may include:
- New account opened in your name
- Change in credit utilization rate
- Late or missed payments
- New credit inquiry
- Change of address
- Public record (such as bankruptcy or civil judgment)
By receiving these alerts in real-time or on a regular basis, you can quickly detect any unauthorized activity on your credit reports and take steps to address it.
How Much Does Credit Monitoring Cost?
The cost of credit monitoring can vary depending on the provider and the level of service you choose. Some credit monitoring services are free, while others may charge a monthly or annual fee.
Free credit monitoring services are typically offered by financial institutions or credit card companies as a value-added service for their customers. These services may include basic monitoring of your credit reports or alerts for certain types of changes.
Paid credit monitoring services may offer more comprehensive monitoring and alert features, such as monitoring of multiple credit bureaus, more frequent alerts, and additional identity theft protection services. Prices for these services can range from around $10 to $30 per month, depending on the level of service you choose.
How Does Credit Monitoring Protect Against Identity Theft?
Credit monitoring can help protect against identity theft by alerting you to any changes or suspicious activity on your credit reports, which could be an indication of fraudulent activity. By receiving alerts in real-time or on a regular basis, you can quickly detect any unauthorized activity on your credit reports and take steps to address it.
For example, if a new account is opened in your name or there is a change in your credit utilization rate, you will receive an alert from the credit monitoring service. If you did not initiate this activity, it could be a sign of identity theft. With this information, you can take immediate action, such as contacting the credit bureau or financial institution to dispute the activity, placing a fraud alert on your credit report, or freezing your credit to prevent further unauthorized activity.
In addition to monitoring your credit reports, some credit monitoring services may also provide additional identity theft protection features, such as dark web monitoring, social security number monitoring, and identity theft insurance. These additional features can help provide a more comprehensive layer of protection against identity theft.
Credit Monitoring Service Providers
There are many credit monitoring service providers available, including (in no particular order):
- Equifax: One of the three major credit bureaus, Equifax offers credit monitoring services that include alerts for new accounts, inquiries, and potentially negative changes to your credit report.
- Experian: Another major credit bureau, Experian offers credit monitoring services that include real-time alerts for changes to your credit report, as well as identity theft protection and resolution services.
- TransUnion: The third major credit bureau, TransUnion offers credit monitoring services that include alerts for changes to your credit report, as well as identity theft insurance and resolution services.
- Credit Karma: Credit Karma offers free credit monitoring and credit score tracking, as well as personalized recommendations for credit cards and loans based on your credit profile.
- Identity Guard: Identity Guard offers credit monitoring services that include alerts for changes to your credit reports, as well as dark web monitoring, social security number monitoring, and identity theft insurance.
- LifeLock: LifeLock offers credit monitoring and identity theft protection services that include alerts for changes to your credit reports, as well as identity theft resolution services and up to $1 million in stolen funds reimbursement.
These are just a few examples of credit monitoring service providers, and there are many others available. When selecting a credit monitoring service, it’s important to carefully review the features and costs of each option and choose the one that best meets your needs and budget.