Easy Identity Theft Tips
It would seem that every week, at least once, we turn on the TV and there’s a headline about a major breach of security where hundreds, sometimes thousands, of people have had their sensitive financial information stolen, or leaked out into the open. This then makes them prey to a vast array of criminal activity that can have a lasting effect on their lives. Follow these identity theft tips if it happens to you.
What happens if my financial information is stolen?
The reason why your financial information is so valuable is not just that it gives people access to your bank accounts, but that they can use that information to impersonate your identity and start up new accounts for fraudulent use – with no consequences to them when they default on the terms. This is called identity theft, the stealing of your good credit limit to access money illegally. In short, they get the cash, and the person whose identity they stole, pays all the bills. Let’s review what identity theft tips you can utilize.
With the growth of internet banking, online shopping and online payment services identity theft has become big business – easy big business. TransUnion calculated that 19 people fall victim every minute. Or, to put it another way, by the time it takes for you to read this article, 30 people will have had their financial information stolen for the purpose of fraudulently gaining money. And it’s not just the stolen money that can cause the victim a major headache.
What happens if I am a victim of identity theft?
It goes without saying that if you are a victim of identity theft that the likelihood is that you may lose all the money in your accounts. All your credit cards and credit limits will also be ‘maxed out’. This means you will have no access to any money. If your social security number is also taken, you may have new credit accounts set up in your name, which the thieves take the money and then default on. All these actions alone are personally bad enough, but they will also have a serious effect on your credit score.
Your credit score will take a serious tumble as soon as your credit is ‘maxed out’. Creditors will see that you are up to your limits and no attempt is being made to pay it back (mostly because you are unaware of it) and your credit score will automatically start to go down. Every time a ‘hard inquiry’ is used to apply for credit (an inquiry that includes a social security number) your score will go down up to 45 points. As you can imagine, the people that have stolen your identity will be firing out credit applications by the dozen knowing that at some point, someone will accept it and give them access to money.
They don’t care how many times they apply to different companies as there is no consequence to them, they will keep trying until either they get success, or the account is suspended. When the account is fraudulently secured the debt goes against your name, which hurts your credit score, is subsequently maxed out, which continues to hurt your credit score, but to make it a triple whammy, the missed payments also go against your credit score. Your credit score will lose around 100 points per credit account. That damage alone can take months to recoup. If you were planning to buy a house or car, rent a new home, get insurance or several other major life changes in that time frame, you may not be able to achieve them until it is all sorted out and repaired. There is no ‘quick fix’ from the nightmare of identity theft.
How can I avoid identity theft?
The best way to cope with identity theft is to avoid it. You can’t avoid having your financial information stored on computer these days unless you have no bank or credit accounts at all and get paid, and only spend, cash, but that is virtually impossible. The only other way to avoid identity theft is to sign up for credit monitoring each month. You will quickly be able to see what has been applied for and requested on your file and check for accuracy. If you have a low credit rating we can help you rebuild it, but we can also keep an eye on your credit rating to report any suspicious activity to you, which we will then work with you to dispute and rectify, clearing up the problem before it has really begun.
Keeping your good name clean is worth the cost, don’t wait until it’s too late to find out how much. Call us, and we can show you how we can help. We hope these identity theft tips were helpful.
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