Imagine you going through a lot of pain to maintain that perfect credit score. You make all your payments on time, no defaults and there is no chance of you being in bad books of credit. All of a sudden you encounter an emergency and decide on applying for a personal loan. When applied for the same, you are rest assured that your loan will be sanctioned within no time; all of a sudden you receive a bad news stating your loan has been rejected! Now you are in a confused state on how this happened and how is it possible on the first place, because you used to make all your payments on time.
After a brief inquiry, you happen to know that you are a victim of identity theft and your information is used for making various financial purchases. Your banker understands the same and suggests you opt for a credit monitoring plan. But what is a credit monitoring plan? Is that necessary for me? How is it going to be beneficial for me? If you have been a victim of identity theft, the answers to such questions are mentioned below:
Let us first understand what is credit monitoring. A credit monitoring service is offered by various third party companies who can keep a track on your credit related transactions and maintain your credit score for future transactions. Customers usually use this service to guard them from identity theft and also to improve cibil score.A credit monitoring service keeps a close eye on your credit activity and notifies you of any credit transactions happening towards your account. The transactions can include any hard inquiry, purchase of a new loan, etc. Some monitoring services also give you a comprehensive tracking of the cibil scores.
Credit monitoring service has its pros and cons, before you enroll yourself for this service, make it a point if you really need this service. Here are the five points you should know before you go for a credit monitoring service:
1. It’s not free forever!
When you plan to opt for this service, you will have a lot of companies offering you free service for a couple of months, do not fall for that! We have this tendency of opting for a service and then forgetting about it, the service provider can charge you until you do not stop the subscription.
2. No service is perfect
You may enter into an agreement that the service provider will give you the best of the service, you can be wrong. Some service provider may not handle your queries well and would not be up to the mark. Before considering a service provider, you can check some online reviews on them and then think if they are worth subscribing.
3. Protection of privacy is important
This service may require sharing your data to third party companies from time to time for resolving any mishaps towards your account. Sometimes the service providers may also sell your personal data. Do read the service contract before signing the terms.
4. Good things are for free
You do know, you can opt for a free credit score once a year just to evaluate your credit report. Take full advantage of the same and check your report yourself because credit monitoring may cost you a lot of money.
5. Always be on a safer side
Choose difficult passwords for your account. Check your accounts regularly. Look for any fraudulent activity towards your account and if you find one, immediately report to the authorities.
Credit Monitoring can be useful if you have taken a severe hit financially due to identity theft. As we always read, “it’s better to be safe than sorry”. Check your accounts regularly or you may take a hit not only on your financial end but also on your mental health.