More and more banks today are offering some form of credit report monitoring service. They send you a letter educating you about the horrible things that can happen if your identity gets stolen, then slide in an offer for $5 to $8 per month for their monitoring service to help you catch it before it’s too late.
The bottom line is that the banks are doing this to make money, not to help you with identity theft. Most of these programs are just ‘credit monitoring’ services. Basically they give you a report every so often indicating the activity on your account, or they send you a warning if they detect any suspicious activity. If your report is stolen, you are still left holding the bag when it comes to all of the effort to get it fixed. This is easy money for the bank, but not so helpful for the consumer.
If you want to totally lock up your credit report, you should look into a credit freeze. A credit freeze stops potential creditors from accessing your credit report without your permission. Without access to your credit report, a thief cannot access your credit. Consumer credit counseling organizations are recommending these freezes as the best way to protect your identity.
The cost for a security freeze is $10 (one time fee). You will have to freeze your report at each of the 3 reporting agencies (Experian, TransUnion & Equifax). You can do this online, just search for ’security freeze’ and the name of the agency (security freeze experian… etc).
If you want to obtain a new loan or credit card, you will need to temporarily ‘unfreeze’ your credit. This also costs $10, and can be done online or by phone. Basically you determine a time period for the account to be available to creditors and then once it expires the freeze is put back in place. For more information check out DebtGuru.com.
