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September 4th, 2009

Should You Sign Up for a Credit Monitoring Service?

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Millions of American each year are faced with the reality that a stranger has stolen their personal information. To help protect consumers from identity theft, the three major credit bureaus have each introduced their own credit monitoring services. But are they worth their cost? Financial experts Ken and Daria Dolan weigh the pros and cons of these services.

Irony

According to the Dolans, the credit protection services offered by Experian, TransUnion, and Equifax can cost anywhere from $60-$180 per year. On the surface, that price may seem like mere pennies in comparison to the costs identity thieves could run up at your expense. However, the Dolans say they can’t help but view these services as ironic:

Our credit keepers use the fear of an ever-growing identity theft problem to rake in lots of dough by offering you the promise of protection. Take it from us…this “promise” can sound like the perfect antidote, no matter the price, after you have been alerted to a theft of identity.

Unfortunately, it only sounds like the perfect antidote. When you dig a little deeper, you find three serious problems.

Problem #1: Most credit monitoring services only track one bureau. If creditors don’t report changes to all three bureaus, there’s a good chance that, unless you monitor all three, you’re bound to miss some very important information.

Problem #2: Creditors can be slow in reporting changes to your credit report. “It can sometimes take a creditor as long as 60 days to report a new fraudulent account,” write the Dolans. “Think of how much damage could be done to your life with a 60-day buying spree in your name!”

Problem #3: According to the Dolans, credit bureaus can’t protect you from someone else stealing your Social Security number:

If someone gets a hold of your Social Security number and opens enough fraudulent accounts in your name before the theft is discovered, credit bureaus basically give your history to this new person – and then start selling this fraudulent information to other creditors!

Are these services worth the cost? Read their post to find out.

The Verdict

We concur with the Dolans when they suggest getting your annual credit report from www.annualcreditreport.com, not from the similar-sounding www.freecreditreport.com — which advertises daily on T.V. and radio.

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6 Responses to “Should You Sign Up for a Credit Monitoring Service?”

  1. BaltimoreHUD (Baltimore HUD Homes) Says: September 4th, 2009 at 7:31 pm

    “Should You Sign Up for a Credit Monitoring Service? | HSH …” http://tinyurl.com/mrcny6

  2. endIDtheft (End ID Theft) Says: September 5th, 2009 at 2:20 am

    Should You Sign Up for a Credit Monitoring Service? | HSH … http://tinyurl.com/mrcny6

  3. Mitch Says: September 6th, 2009 at 12:05 am

    Oh sure, and I’m the guy who has a Free Credit Report account. :-) Actually, I like getting my monthly report, even when it says nothing’s going on. Guess I’m a glutton for punishment.

  4. Why do racing tipsters? financial experts work for TV and newspapers? | Horse Racing Memorabilia Says: September 7th, 2009 at 5:16 am

    [...] Should You Sign Up for a Credit Monitoring Service? | HSH … [...]

  5. Tim Manni Says: September 8th, 2009 at 10:57 am

    Hey Mitch,

    That’s interesting. Have you been happy so far with your FCR.com account?

  6. EDavila Says: September 17th, 2009 at 3:21 pm

    I recommend http://www.bestcreditreportonline.net for a Credit Monitoring Service, as well as the ability to Dispute Credit Items and to keep track of your Accounts on your Credit Report.

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HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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