What You Need to Know about Credit "File" Monitoring:

Credit monitoring can be one of the easiest, most efficient and cost effective manners for preventing and detecing mistakes on your credit report. Read more to learn to learn how easy it is to monitor your credit and how monitoring my credit enabled me to quickly detect credit blemishes and unauthorized use of my credit information-- as well as how the monitoring system helped me to make corrections to my credit report.

Credit monitoring is an easy, effective method of monitoring the following information: inquiries into your credit line; new account activity; reported address changes on credit information; when and if collection activity has occurred in your name; changes to account information (such as increases in spending limits); changes in public records (such as judgments against you); any delinquencies or other negative changes to your accounts; as well as closed accounts. Credit monitoring does not keep identity theft from occurring, but an informed individual is able to note quickly changes in their report on a regular basis and take the appropriate steps to correct any mistakes on their credit report or detect any changes in their credit status that can be harmful.

It has been proven, that although credit monitoring does not stop an identity thief dead in their tracks, it does limit your liability as well as keep you informed when any change occurs. Those who detect this negative or false activity on their report early are able to lessen any possible financial and credit rating damages.

There are several variations on credit monitoring services. The ones stated here are pretty much the industry standard, however, you may purchase additional services. The report itself is easy to read and provides credit providers, balances, contact information, payment information etc. In some cases you can even file your dispute (a disagreement with the facts presented) online while viewing your report. I suggest whatever report you chose allows you this option. You will be more likely to move quickly and efficiently in clearing up any mistakes.

I also recommend that whatever monitoring plan one decides to use - use a monitoring service plan that includes sending monthly status reports via email, that encompasses the three major credit agencies TransUnion, Experian, and Equifax. Without this 3-in-1 option, some credit problems may not be reported to you in a timely manner, so if your monitoring plan only covers one credit bureau - you're out of luck!

The cost of credit monitoring services varies in price from approximately $12.99 over $39.99 monthly. The federal government has provided consumers with the ability to obtain one free credit report each year through the rules and regulations of the Fair Credit Reporting Act and is available from annualcreditreport.com. Your report may be obtained either online or via regular mail. However, once a year may not be enough to protect you, so you may want to invest in an additional program.  One last word of caution; be sure your credit monitoring service is reputable.

You may want to contact one of the three credit report agencies or a financial professional to help you in making your choice of credit monitoring service.