When it comes to checking your credit, you probably do it as you gear up for a major milestone. Changing careers, moving apartments, or taking out a personal loan may hinge on the contents of your credit file, and your score may determine how easy it is to achieve these goals.
But taking a peek just for the sake of checking it? That’s where a lot of people slip up. By ignoring your score in between these routine checks, you may have no idea you’re a victim of identity theft until it’s too late.
check out how to dispute item on credit report
What is Identity Theft and How Does it Happen?
Identity theft happens when someone pretends to be you. They manage to get their hands on key information that only you should know, and they use it to access your finances and open fraudulent accounts in our name.
With your contact details, bank account numbers, and social insurance number, they can open lines of credit and payday loans. While payday loans direct lenders will review the information your imposter supplies, they may not flag the application as unusual. It looks like a genuine request for funds, and it links back to a real person: you!
Payday loan lenders offer short term loans that come with high fees and a short turn around. While they may work in some situations, they will cause a problem should a fraudster take one out in your name. That’s because your fraudster has no intention of paying it back, which means the account will accrue interest and late fees. It may even affect your credit depending on how direct payday loan lenders share delinquencies.
You can learn more about online payday loans, but the long and short of it is this: you don’t want to be held responsible for an online loan you didn’t open.
How Can You Tell if Your Identity Has Been Stolen?
If you’ve been defrauded, you might not know anything is wrong until you get an alarming phone call about money you owe. Or you may be denied an installment because your credit is much lower than you remember.
To avoid these shocks, you can spot the signs if you proactively check your report. These entries may hint there’s something fishy going on:
- Hard pulls for applications you didn’t make
- Inaccurate account balances for existing credit cards and lines of credit
- New cash advances, payday loans, and other accounts you didn’t open
What to Do if Your Identity is Stolen
Take these three actions if you think you’re a victim of identity theft.
- Get in touch with the company of the account and the reporting agency that generated your report. They’ll patch you to their fraud departments and walk you through the next steps.
- Change all your passwords to take back control of existing accounts.
- You may also decide to freeze your credit so that your fraudster can’t open any new accounts with your info.
How Can You Check if You’re a Victim?
Each of the three major credit reporting agencies offers one free check each year, so you can check it three times in 2021 without having to invest in costly credit tracking services. So, set a reminder to check it, and stay on top of this task every four months.
