Identity Theft: Know The Warning Signs And How To Stop It

Identity Theft: Know The Warning Signs And How To Stop It

Identity theft is used in countless movies and TV shows where secret agents become someone else in order to gain access to spy labs and formulas. Or maybe you’ve seen that episode where a child fills out a credit card application in the name of a relative and goes on a spending spree. While identity theft certainly can be creative to move along a plot, it is more devastating in real life, not to mention illegal. Take the latter example – a child with a credit card belonging to someone else can be a danger to that person’s bank account, credit history and credit score. Always monitor your free credit reports and scores on a regular basis to make sure no unusual credit activity is occuring.

Unlike the movies, where identity theft is plotted ahead of time, many thefts in real life happen by chance. You lose your wallet, someone finds it and decides that becoming someone else is a good idea. There are a lot of ways for dishonest people to gain access to your sensitive information, so it is important to be cautious and prevent identity theft.

Steps to take to prevent identity theft

Stealing a person’s information online can be easy or it can be difficult – it’s up to you. If you use the same password for every website you’ve ever visited, if you always type in your password, and if your password consists of only numbers or only letters, then it may be very easy for someone to swipe your login and password information. Here’s how to fix it. Install an anti-virus program that detects malware. Next, use a different password for each site, and if you fear you might forget them, keep them written in a binder or a plain text document. Don’t label the document “passwords,” though. Now, each time you go to enter a password, open the plain text document and copy and paste your password. Many malware programs record keystrokes, which is one way thieves can steal your social security number, password, date of birth and more. Prevent identity theft by changing your password if you see any suspicious activity in any account. If you use public computers frequently, it may be a good idea to rotate passwords or change them every six months.

Keep your social security card locked up in a safe at home or a safety deposit box. You should only need the document for a few purposes, such as applying for a passport or when you start a new job. Never keep your social security card in your wallet because if you lose your wallet, someone can do just about anything they want with your card and driver’s license. Some companies require your social security number, but research the company or ask the representative why they need the number and how the company will use it. You can always refuse to give out the number on the phone and opt to do business in person as a way to prevent identity theft.

Take advantage of your free, annual credit report. The all 3 credit reports will list your credit history for the past seven years, so you will be able to see any new accounts, closed accounts or existing active accounts made in your name that could be suspicious. Identity theft can severely lower a credit score if the thief signs up for multiple credit cards. Each inquiry can lower a score, and then of course non-payment on accounts you didn’t know you had will plummet the score even lower.

Reporting identity theft

If you lose your wallet or if it is stolen, file a police report. This report will be used by your bank, insurance company, the credit bureaus and credit card companies as a reference when you alert them to the theft. Cancel or place holds on all debit and credit cards, and ask that your bank notify you and the police if they see any activity on your accounts

How To Rebuild Credit: the Basic Facts

How To Rebuild Credit: the Basic Facts

These days, if your credit score is in shambles, then so is the rest of your life.  Of course, we all know pretty well that the banks will check your credit score for mortgages, and dealerships will check it for auto loans, but the rabbit whole goes even further downward.

Did you know that insurance companies would give you a higher monthly rate if your free credit report gov is an issue?  Their reasoning is that you are more likely to be less responsible and pay them on time.  Also, some employers will deny you a job after checking your credit score.  While this may seem like a total invasion of privacy, this is the unfortunate world we live in.

So, what do you do if your credit score has been destroyed?

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Save Up A Cushion

What got you hear in the first place?  Usually, good people don’t find themselves into debt because they went on a shopping spree.  Good people find themselves in deep because there was a crisis, a job loss, a car crash, a medical bill, or even a friend in need.

But, what do all these problems have in common? About $1,000 could have kept you afloat.  What we usually do when problems come our way is to put it on the card, but it is best to save up about one grand.  This way, you are not tempted to charge when there is a crisis.  Keep it safe, secure, yet extremely liquid.  This is your “rainy day fund”.

The Snowball Effect

The next step is to take on one payment after another.  The key here is to begin to achieve motivation in the form of momentum.  It was momentum that got you here, and it can be momentum that gets you out.

Your first step is to get the ball rolling by paying off the least credit card first.  Did that feel good?  Well, just wait.

Next, use that extra money to pay down the next largest pit of debt.  This will keep the snowball in motion.  Of course, while you are doing this, make sure you are making the minimums on your other debt payments.  Just continue the pattern of using the extra money you save from the each item that you’ve paid off, and apply that to the next round of debt.

As you keep using this method, you will notice that the snowball becomes easier and easier to roll, until eventually gravity takes over.  Before you know it, you’ve taken care of two credit cards, your car, and you are working on your student loans.

An Ounce of Prevention

There are a lot of people that say that you need credit cards to keep your credit alive, and some advisors have even directed people to get “store credit cards” to build it.  Unfortunately, this is a fallacy, as credit card debt is almost always seen as toxic.  If you want good debt, then get a school loan and invest in your education.

The key to digging your way out of financial disaster is going to be playing on what motivates you and preventing what draws you into problems.

Establishing Credit: You Can Build A Good Credit Score

Establishing Credit: You Can Build A Good Credit Score

hankfully, we aren’t born with a credit score. However, trying to establish credit can be challenging, so it is important to know that you can set yourself up to be an ideal candidate for a loan or credit card long before you are eligible.

Lenders and credit card companies can look at your bank account history, residence history, employment history and utility accounts in your name to determine if you are creditworthy by obtaining your 3 credit reports. Factors that are noted are how long you’ve had a bank account and if it has gone into overdraft frequently; how long you have lived at your current address or previous addresses; whether you have gaps in employment or are steadily employed; and the payment history of utility accounts (if you paid late or had delinquent accounts).

If you have a bank account, apply for a credit card through that bank. They may be more likely to help you establish credit if you have been a longtime customer with a steady account.

Establishing credit

Credit bureaus want you to have three to five credit cards so that they can adequately judge your responsibility and credit history to determine your credit score. But going from zero cards to five cards can be impossible, and it is not advisable as multiple credit inquiries can lower any credit score you have. One way to break into the credit world is to get an in-store credit card. While there are thousands available, don’t just apply for every card you see as multiple forms of new credit lines looks risky to credit bureaus and lenders. Pick one in-store card that you would use monthly. That doesn’t mean find a high-end department store and charge mink stoles each month. Find a store at which you already shop regularly. Grocery store credit cards are a good idea because you have to buy food. You may not need to buy a new sweater every month.

If you deal with a landlord, utility company or credit card issuer who reports to the three major credit bureaus, you can request that they do so. A utility company may only report delinquent accounts to the bureaus, so if you’ve had a stellar payment history, ask the company to report to show that you’re fiscally responsible.

Building a high credit score

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Debt can accumulate quickly and before you know it, your credit is ruined just as fast as it was established. There are ways to help keep you debt low while you establish credit. First, only charge a small balance each month that you can quickly turn around and pay off. Never charge more than 30 percent of your credit limit. The closer your balance is to your credit limit, the riskier you seem to lenders. And paying off your balance each month shows you can be responsible with your credit cards. If you feel like your spending might get out of hand, choose one item or area to use a credit card, such as buying gas or groceries. Then, pay off your credit card’s balance within the next week so you can keep accurate banking records.

Another way to build your credit score is to keep credit cards open, even if you don’t use them often. Maybe you applied for an in-store credit card to establish credit but no longer require the credit card. Don’t close the account. A major factor in deciding a credit score is the history of your credit. People who have had credit card accounts open longer are considered less of a risk than those who recently opened an account.

What You Should Know About In-store Credit Cards

What You Should Know About In-store Credit Cards

Times are tough, money is tight and every month comes a holiday with commercials telling you to go out and buy chocolates, flowers, gifts, clothes, jewelry and food for a holiday family feast. And when you load up that shopping cart and hit the check out aisle, an in-store credit card sounds too good to be true (“Save 15 percent on my purchases today? Sounds great!”). But before you begin saving $10 here and $25 there, take a few minutes to find out if an in-store credit card is worth owning or even applying.

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Read the fine print

Behind the register, many store associates are paid based on the number of credit card applications they are able to have successfully filled out each day. For some, this can be mean being fired for under-performing, or not getting enough customers to apply for a credit card. This is why some associates seem to be a little more pushy when it comes to the application. Other stores require associates to ask if the customer wants to sign up for a card, but the company does not impose penalties if the associate doesn’t reach a certain goal. Both of these reasons lead associates to ask, “Would you like to sign up for a credit card today and save (a certain percentage) on your purchase?” However, in many cases, the associate is not giving you the complete picture.

Most retailers offer a sign-up bonus as incentive for customers to apply for an in-store credit card. However, we all know that signing up is a hasty process because the customer is then holding up the line, with inpatient guests waiting to make their purchases. While the associate is likely not purposefully trying to mislead you, this high-pressure situation encourages many to skip reading the fine print and fill out the information required. But this can be detrimental to your getting a free government credit score.

Some in-store credit cards affect your credit score because the store reports to one or more of the three major credit bureaus. But did you know that simply applying for a credit card can lower your credit score? When you apply for an in-store credit card, an associate or manager makes a phone call, checking on your credit line. This phone call can lower your credit score anywhere from 5 points to 35 points, based on multiple factors, such as your current credit score, the company’s credit policies and the amount of the credit line on the new card. And this is before you spend a dime. There are excellent sites to obtain your 3 credit reports and scores that can provide resources to learn more about your credit.

Know when to apply for credit cards

Credit cards must be used or they will not help your credit score. If you open a card and it sits at a zero-dollar balance for eternity, the card will likely lapse into an inactive state. A credit score is established by many factors, but two important ones are the balance (how much you owe) and the length of time the card is active. If you must have an in-store credit card, keep the balance low, pay it off quickly and hold onto the card as long as you can.

In-store credit cards aren’t all bad. They can do some good if you’re careful and use them wisely. Saving $3.50  isn’t a good enough reason to open a credit card. But, if you have good credit already, and are looking to get a bank loan (such as a mortgage loan) in the near future, opening a line of credit might be a good idea if all three of these situations apply: you are saving more than $100 on the purchase by opening the card; you have less than three credit cards; and if you are in a position to quickly repay the balance.

This is by no means an all-inclusive list of reasons to skip or apply for an in-store credit card, and in the end it’s all up to you, so be smart, read the fine print and know your income limits.

A Credit Score May Be The Most Important Number In Your Life

A Credit Score May Be The Most Important Number In Your Life

Of all the numbers that dominate our lives, none may be more important than a credit score. credit score is a three-digit numerical representation of a person’s creditworthiness, which lenders use to determine how likely a person is to default on or pay off a loan or debt. The majority of credit scores range between 300 and 900, but for favorable credit consideration, a person needs a score of 720 or higher.

Картинки по запросу Credit Score May Be The Most Important Number In Your Life

Why is a credit score used?

Lenders use a credit score to evaluate a loan amount or credit limit for an individual. Banks base a loan’s amount and interest rate on the applicant’s credit score, which means a poor credit score can lead to high interest rates on a low principal loan. A poor credit score can also disqualify a person’s loan application if a bank or company deems the individual to be a risk. Sites such as http://www.three-credit-report.com can get your free credit score so you can see what your score is.

Some financial institutions and credit card companies impose credit score limits, while others cater to individuals with lower credit scores. It is important to discuss these options before an institution conducts a credit check as each check can negatively affect a credit rating.

Banks are not alone in running credit checks. Landlords, government agencies, credit card companies, quick loan services, insurance companies and even cell phone companies may check an individual’s credit score before conducting business. You should always ask if a credit check is required, and only agree to one if it is absolutely necessary.

Who decides a credit score?

There are three major credit bureaus to which most lenders report. Experian, TransUnion, and Equifax each determine a credit score individually. So, one person may have three scores – one score from each credit bureau. Mortgage lenders also depend on FICO to find out a person’s credit score.

While there could be a definitive formula to calculate a credit score, these formulas are not public. But there are known factors that help determine a credit score. A person must have some form of credit to determine creditworthiness. This may seem to go against what most people think, but having too few credit cards means FICO and the credit bureaus may not have enough information to compile a true representation of a person’s creditworthiness. Without proper credit representation, a person is seen as a credit risk.

Credit score factors include:

  • The amount of debt. Large amounts of money owed on loans and credit cards have adverse effects on credit scores. That is why is it recommended to pay off any debt as soon as possible and keep loan amounts as low as possible.
  • How long debt lasts. The length of time it takes to repay a loan or pay off the balance of a credit card affects a credit score.
  • Your payment history. Making payments on time can help your credit score, just as missing payments may hurt the rating.
  • Any new credit. Each time you apply for new credit (such as a new credit card or a loan), a credit score check is conducted. These credit requests are recorded, and multiple credit checks in a short amount of time can be considered risky.
  • The types of credit you use. Bank loans, bank credit cards, in-store credit cards and payday advances are all different types of credit used. The more types you use, the riskier you seem.

Talk to a financial adviser or your lending institution to discuss ways of managing your credit score.