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The Resource Center Credit Fraud & Credit Monitoring | article

An Annual Credit Report Sounds Good, But Is It Enough?

These days, it’s hard to browse the Web or turn on the television or radio without coming across mentions of free credit reports. You can get yours from a variety of companies that provide access to them, including a free copy once a year from each of the three credit bureaus — Equifax®, Experian® and TransUnion®. While not having to pay for a copy of your credit report is nice, you may wonder if there are more comprehensive ways to keep tabs on your financial profile than simply glancing at a free credit report.

This may be especially true if you are considering making a large purchase that requires an extensive credit check, such as buying a house. Since the slightest financial blemish can affect how much credit you qualify for, and the interest rates you will receive on your loan, times like these may make you want to monitor your credit more closely. And there are a number of companies out there that offer this service.

So, what do you get when you pay for credit monitoring? Here are some examples of the information credit monitoring services like Identity Guard® provide that you won’t get on a free credit report:

  • Making sense of reports. Each of the three major credit reporting agencies issue reports in different ways. They can be difficult to understand if you don’t have a lot of experience reading credit reports. A monitoring service can help you synthesize that information in a way that’s easy to read and decipher.
  • Access to all agencies in a single report. Not only do each of the major reporting agencies not compile reports in the same way, they also don’t necessarily share data. So, while you might not have a blemish on one agency’s report, one may appear in a report from a different agency. A credit monitoring service allows you access to reports based on data from all three agencies, so you can check them all for discrepancies. Because of the lack of formatting in the free credit reports, it can be difficult to impossible to compare and contrast the credit reports you receive from the different agencies.
  • Daily monitoring. Whenever you request a free report, the information you get back reflects your financial situation as it stands at the time of your request. So, where a one-time free credit report provides a snapshot in time of your credit history, credit monitoring gives you a more complete, moving picture. As you work toward improving your credit rating in order to make a major purchase, you can keep track of your progress and apply for financing when you feel most comfortable.
  • Alerts. In addition to giving you daily updates on your credit, you can and should pick a credit monitoring service that will alert you if certain changes are detected in your credit report. That way, if you become a victim of identity theft or other related fraud, you have the ability to deal with it immediately and keep your credit in good standing.

The bottom line is that by spending a few dollars to monitor your credit, you may end up saving yourself a significant amount of money in the long run because you’ll be able to get a better interest rate on a mortgage or large loan. You also will have the added benefit of knowing when your credit has been compromised.