Scams of credit and Identity Theft
We all hear in the news, the newspaper, and the radio about identity theft and credit scams; we may even personally know someone this has happened to. The question is how do we protect ourselves from these problems? If you are a victim of one of these it can certainly be stressful, time consuming, and a nightmare to try to repair the damage done. This article will address some of the steps you can take to help prevent and protect yourself from having a credit scam or identity theft happen to you.
Credit Repair Companies
Do not get caught up in these, we have all seen them on television or heard them on radio promising to repair your credit and wipe out the debt. Usually for a fee they will promise to repair your credit, wipe out the debt, and or get your creditors to stop calling you. These are credit scams! Many of these so called credit repair companies take your money never to be heard from again. The only person who can repair your credit is you! Also do not be fall for buying information on how to repair your credit, this is just one more credit scam. There is no easy way to repair your credit and the information they send for the money they charge you already know. It is just plain common sense things like;
- Do not live beyond your means – meaning if you can’t afford it do not pay for it with credit unless an extreme emergency, car repair to get to work, broken hot water heater.
- Make a budget, for a month write down everything you spend and on what it was. You will be surprised at how much money you spend on things you really don’t need.
- Stop eating out for lunch and dinner, pack your lunch and cook dinner at home. Cooking from scratch is less expensive than buying premade dinners as well.
- Cut down on things that are not necessities such as soda, cell phone, cable television
- Then you take that money and pay extra on the smallest debt you have until it is paid for then take the amount of that bill that was just paid off and add to the amount of the next smallest bill. Continue to do this until you are debt free.
If you cannot work out a budget to pay off your debts by calling the creditors you owe then go to a certified credit counselor. They often can reduce payments on credit cards and other debts to get you on a budget you can live with while paying off your debts. Just make sure they are certified and not a credit scam. You have to do your homework, check with the Better Business Bureau.
Do not get taken by a credit scam where a company offers you credit insurance. When you get a loan or a credit card, make sure there is optional insurance to go with it that will cover you if you become disabled, unemployed, or die. Have this insurance explained to you so you know exactly what it covers, how to use it, and what it costs.
Beware of Advance Free Loans
Beware of anyone telling you that they can get you a low interest low to settle your debts. This scam happens frequently, usually they promise a low interest loan, get your information and apply for a loan then take that money and run. Sometimes they may call and say you didn’t qualify. No one with bad credit qualifies for a low interest loan, lenders are wary of people who can’t or won’t pay back their loans.
Again another problem that is on the rise, people get your personal information and take out credit cards and loans in your name, then you are left to prove that it was not you. This can happen in several ways so how do you protect your identity without spending a fortune doing it especially if you are already in debt and fighting to pay your bills and eat along with repairing your credit?
- Protect your vital information social security number, bank account numbers, and credit card numbers. If you store such information on your computer you need to make sure it is in a password protected file. Storing such information on a computer is truly not a good idea.
- Do you do banking online make sure the bank site has the proper security, as well as your own network security being up to date.
- When purchasing something like diner on your credit or debit card, do not place the card in the bill holder and have the waiter/waitress take to the pay area. Do it yourself and watch them run the card. This prevents them from duplicating the account and the 3 digit number on back.
- Debit cards can be used to make purchases on line without using your pin so do not think they are safe if lost or stolen.
- Pay close attention to the statements every month whether they are paper or online statements go over them very carefully even if you have them on auto pay. If you see something that you are not sure of call the company about it.
Change your thinking
Change the way you think about your credit, just because you have 8 credit cards does not mean that you have a good credit score. There is no reason to have 8 credit cards. Most stores will accept visa, MasterCard, discover, and American express, there for there is no reason you should have a credit card for stores like Kohl’s, Sears, or Macys. Gas pumps will also accept most major credit cards and some debit cards, so again there is no reason to have 3 or 4 gas company credit cards. You also need to watch out for the offers the credit card companies make themselves which to me is another credit scam, they promise you a lower rate for 6 months or a year and all you have to do is transfer your balance from another card to them and use the card for further purchases. Another one is cash back and airline mile rewards. Read the fine print, that offer is only good for six to twelve month after that the interest rate will go to 19 or 20 percent, with the cash back or mile rewards you will find that they can only be spent on certain things. Take cash back, this cannot be used toward paying down your balance.
The only way to truly protect yourself is to research, read the fine print, and pay attention to your monthly statements.