Handling Identity Theft

Perhaps you went to get the mail just like any other day and among your mail is a notice saying you are overdue on your Disney credit card. The only problem is that you don't have a Disney credit card. The name on the letter is obviously yours, the address is yours, but the numerous and expensive  charges are definitely not yours.

Maybe you applied for a mortgage for that dream home you've always wanted. The price was right, the rates looked good, the house is perfect. Then the loan officer tells you that you are declined. Your credit report is riddled with collections and no pays.

No matter how you find out, identity theft is tragic and destructive. It can easily destroy your credit and may even land you in jail. So now that you know about it there are some immediate steps that you need to take to address the theft

Immediately contact the big three credit bureaus. Request a free copy of your credit report. You are entitled to a free copy once a year from each at www.annualcreditreport.com. Review the reports to see just how extensive the theft is. Brace yourself, this may have been happening for years. If not, then you are truly one of the lucky ones.

Contact the bureaus and dispute the items that are not yours. Further, place an alert on your report.
After contacting the credit bureaus themselves it is time to contact the individual companies that have items on your report. Each company that appears on your credit report that is not a legitimate entry of your own needs to be contacted.

Inform them of the crime and dispute the transactions. They will have paperwork for you to fill out. Especially if there are many companies to contact this step may take a long, long time. Complete the paperwork as quickly and thoroughly as possible and get it back to the company.
United States law protects you in some cases in this, but your time is limited and short. If you are only catching this after many years you may not have much recourse.

After completing all of this, and immediately, for time is a major factor, take the appropriate steps to prevent it from happening again and to prevent the situation from escalating even worse.
Sign up for a credit monitoring service to keep an eye on your credit. This will alert you whenever anything happens on your credit, allowing you to know if the thief is trying to use your identity again. You may even be able to catch the thief in the act, if not, at least you can limit the damage that the thief does to your identity.

Identity theft is scary and damaging, if it happens to you your best bet is speedy action.

Using a Personal Loan to Help Repair Your Credit

Credit repair can be a long and difficult process, often showing little result for a lot of time and hard work. Depending on the extent of the damage that you are trying to repair one option may be to consolidate your loans and credit cards into a single, lower monthly payment with a lower interest rate.

Finding a low interest personal loan typically means that it will have to be a loan secured by some manner of collateral. A home equity line of credit typically allows the flexibility necessary to consolidate multiple debts and provides a very competitive interest rate. Other forms of collateral may include a vehicle, a bank CD, a savings account, or even securities (like stocks and bonds).
By offering collateral the risk to the lender is lowered and they will offer you a lower interest rate.

The key here is to secure a loan large enough to cover all of your debts and with a rate lower than what your other debts offer.

Then use the new secured personal loan to pay off your other debts. The thing to remember is that you never get out of debt by taking out more debt. Just because you have paid the loans off with another loan doesn't mean that these debts have disappeared, you do not suddenly have extra money.

The danger is that people often think it is now acceptable to go out and charge up their credit cards again. Doing this means that the method of credit repair they are attempting actually adds to their debt and puts them in a worse position than where they started.

Provided that you pay off all your loans and that the interest rate is lower now, after consolidating, than it was before means that you will now be paying less money to pay your debts. Any debts that were overdue have now been paid off. If the temptation is too great to start charging again call and cancel the paid off credit cards.

Consolidating your debts into a personal loan can help you to begin repairing your credit but it needs to be done responsibly. If you cannot provide collateral and the only loan that you can secure for debt consolidation increases your rate it most likely is not a good idea. For more severe credit problems seek professional help. If you do not have the personal discipline to keep from going more deeply into debt this method may not be right for you.

Five Mistakes that First Time Homebuyers Make

You have decided that the time has come to purchase your first home. Congratulations, you are taking a major step on your way to living out the American dream. The euphoria that overtakes you when you enter that perfect home, that home that you want to make your own, is incredible, overpowering, even life-changing. That rush, however, could be quickly dashed and dampened if you make any of these common 5 mistakes that of first time homebuyers.

1. You're mother might have told you to shop around; this is the time to thank her for that bit of wisdom. Failing to do enough shopping when looking for a home can lead to serious problems. Your excitement can make even a poor choice seem like an ideal one. Shop around and get help from a professional. Carefully consider the neighborhood and the market.
Nothing is worse than finding that perfect home and then discovering that it is well out of your means. Three of the five most common mistakes first time home buyers make involve poor planning concerning their financial condition.

2. Mistake number two is failing to know the condition of your credit. I've seen people in the office with their mortgage lender receiving the news that their identity had been compromised and they were ineligible for a mortgage. The devastating possibilities of not keeping track of your credit report can cost you your first home. Fortunately, thanks to the FACT Act you are entitled to a free copy of your credit report annually from the three major credit-reporting bureaus. Visit www.annualcreditreport.com right now and see what is being reported about you. Make sure that it is accurate.

3. Once your credit report has been verified for accuracy secure that mortgage! Research lenders and programs (remember that failing to shop is mistake number 1), choose a lender and apply for pre-approval. See what the lender is willing to lend to you. Knowing how much you can borrow will help narrow your search to homes within your range and help you avoid the disappointment of finding that your home of choice is outside what a lender will lend you.

4. A startling fact to keep in mind is that 100% of foreclosures are on loans that the lender felt the borrower could repay. Just because the lender will lend you all that money does not mean that you can necessarily afford that much home. Remember that with that home comes bills that you may not have paid before, taxes, and various expenses, like lawn care. Budget for all of these and more. A general rule of thumb is that your housing expense, i.e. your mortgage, should be around 30% of your monthly income. Calculating the true cost of that home is crucial if you want to be sure that you can afford to keep that home.

5. The final big mistake that first time homebuyers make is failing to get the house inspected. There are thousands of things that can be wrong in that house that you think is so perfect. Hire an inspector to make sure the house is sound. Do not assume that since the bank is having the house appraised that you do not need an inspector, that is not what the appraisal is for. Also do not assume that because the seller has done an inspection everything is OK, that inspector was working for the seller, not you. Get the house inspected!

There are many things that can go wrong when looking for your first home. Don't let any of these five mistakes be one of those things that go awry. Buying your first home should be euphoric, do everything you can to keep it that way.

Protecting Your Identity

Few things are scarier in this modern age than having your identity stolen. Your very identity being stolen, used, and abused. It is a crime where the thief is faceless, unknown, and seldom caught. This veil of secrecy is part of what is so scary; the thief could be anyone, anywhere.

This frightening crime can happen t almost anyone without notice and often can takes months or even years to detect. Someone can be living off of your identity for years, even worse, someone may even be committing crimes in your name.

Is there anything you can do? How can you protect yourself?

The best defense against identity theft is to be proactive about monitoring your credit report. By keeping a close eye on your credit you can detect if there is anything happening with your identity. Fortunately there are a couple ways to do this.

The FACT act allows you to obtain a copy of your credit report from each of the three main credit reporting bureaus every 12 months for free. This allows you to check your report for inaccuracies every year. If there is anything incorrect on your credit report contact the bureau directly.

Several web sites will offer these reports, but many will charge you for the privilege. The Federal Trade Commission established a web site where you can access the free reports every year. Do not be fooled into paying for the right to see your report.

Credit monitoring services can also help protect you from identity theft. Again, with identity theft becoming such a major problem an entire industry has arisen around offering identity theft protection. Some services are reliable and helpful, others not so much.

Deal with a reputable service to ensure that you are getting what you pay for. Ask for referrals from friends and family, or just go with one of the big three bureaus- Equifax. They offer a comprehensive plan on there site that includes another free copy of the credit report.

Another excellent way to protect yourself from falling victim to identity theft is to limit the amount of information that may be stolen. Never, ever, provide sensitive information in E-mails or respond to requests for account numbers, passwords, social security numbers, or any other personal information.
All personal documents that you are discarding should be shred. Dumpster diving can compromise your personal information and allow it to fall into the hands of potential thieves.

Identity theft is scary and dangerous. It can lead to years of damage to your good name. Take action to protect yourself and monitor your credit. Simple steps now can save you a lot of trouble later.

How to Report Identity Theft

Finding that you have fallen victim to identity theft can be an awful experience. Maybe you received a large credit card bill in the mail for a card that you have never owned; maybe you were denied credit for a car loan; even worse, maybe you were told that you could not get a mortgage on your dream home because of your credit.

No matter how you learn of the theft of your identity there are four places you must contact immediately:

1) The credit bureaus

When you contact the credit bureaus you will need to place a fraud alert on your reports. This will prevent the thief from opening any future accounts in your name. This will also entitle you to a free copy of your credit report.

Review this free copy of your report to check for errors and for instances of fraudulent accounts. Any accounts that you cannot identify should be immediately reported to the credit bureau. The credit bureaus will allow you to dispute inaccurate information right on their websites.

The three major credit bureaus are: Equifax, Experian, Transunion

2) The companies that have fraudulent accounts on your report

Contact all of the companies that are reporting illegitimate information on your credit report. You will want to talk to someone in their fraud department and send them any supporting documentation that you may have in your possession. Be sure to send only a copy, not the originals, keep those in your possession.

In many cases the company will require that you fill out an affidavit of fraud, particularly banks. Ask for a copy of this form if the company does not automatically give you one. If they do not have such a form ask if they will accept a copy of a police report or the Federal Trade Commission's ID Theft Affidavit.

3) The Federal Trade Commission

You can, and should, file a complaint directly to the Federal Trade Commission (FTC). By doing this you will help the federal government and law enforcement track down and fight ID theft. The FTC will distribute the information about the theft to appropriate agencies and investigate companies that may be participating in the theft.

By filing the complain online you can print it and provide it to companies that may request it and to local law enforcement. According to the Federal Trade Commission, this filing, along with the police
report, can be used to:

(1) permanently block fraudulent information from appearing on your credit report;

(2) ensure that debts do not reappear on your credit report;

(3) prevent a company from continuing to collect debts that result from identity theft: and

(4) place an extended fraud alert on your credit report.

4) Local law enforcement

Call your local police department and inform them that you need to file a report concerning identity theft. This is best done in person but occasionally must be done on the phone or online. Give the police department a copy of the FTC filing so that they may add it to the police report.

Of course, get a copy of the police report once it has been completed and keep this for your records. The police report may be necessary to file a claim with individual companies.

While identity theft can be incredibly damaging and scary, don't allow it to paralyze you into inaction. Immediately contact these groups and file the necessary reports.

Have you checked your credit score?

The American Bankers Association has launched a Get Smart About Credit campaign for the month of October. So for most of this month the focus here will be on managing credit.

The first most important thing to know is where you stand. You can get free copies of your credit report from annualcreditreport.com. There you can get your credit report from each of the three major credit bureaus for free, once a year.

Additionally, Wells Fargo Bank is offering a free credit score and complimentary credit report to all customers until mid November.

No matter how you.do it, get your credit report this month and check it for accuracy. Know where you stand!