Have you heard of credit monitoring? It is a service that reporting agencies offer to you. The service is quite straightforward. For a fee, they will monitor your credit for you to insure that nothing strange appears or that nothing out of the ordinary reduces your score. Is an investment in such a service worthwhile?

How Credit Monitoring Can Benefit You

First of all, monitoring does do something that has become necessary with the advent of different types of credit fraud. Any consumer, anywhere that uses credit needs to monitor their score and report. It is necessary because at any time a negative item is placed on your report it can be very detrimental to your future credit needs. Those who commit such fraud do not necessarily need your social security number or other personal details. It all depends on where they use your card information.

It is important to know what’s on that record and it is important to know how it got there. The longer it goes without being disputed, the more ‘real’ it looks in the eyes of the law. In this way, monitoring really can benefit you because you will be notified right away when negative activity is reported on your report.

How Credit Monitoring Can Rip You Off

It is true that such a service can be helpful, but monitoring is very expensive, up to $150 per year in some cases. This money can be used to help reduce credit card debt instead. If you are net savvy, then your credit report is a few keystrokes away. All of the major reporting agencies can be found online and can tell you’re what your report looks like.

Also, in the United States, as of this year, you are provided a free credit report each year from the credit reporting agencies so that you can monitor your credit history. This free product may not be enough, but it is a start. You should check your report often and know what is on it. Ideally, you should check your report every 3 months. If you are going to be making any large purchases e.g. a new house, a new car you should get your report a couple of months in advance so that you can clear up any negative items in time to get the best deal on your purchase.

You are entitled under the law to a free copy of a credit report from each of the three credit bureaus each year. You are not, however, entitled to a free copy of your FICO score.

That means that you can know what the positive and negative marks are on the report but not to the formula or the number itself.

These days, creditors look almost exclusively at the number, not the report.

When people get their credit report and do not find the number, they start looking up “Free FICO score” and the like on Google.

What they find is that they can get their FICO score, but there’s a hitch. The score is not really free. It’s free if you sign up for offers.

Now, you can cancel these offers, but as anyone who’s ever tried to has found out, it can be very difficult. So, your “free” FICO score ends up costing you $9.95 a month indefinitely.

For instance, the Experian site offers a free credit report if you sign up for their credit monitoring service. The service is free for the first 30 days and then there’s a fee.

One final thing to keep in mind is that a credit score is not a FICO score. The credit score is something the individual bureau gives you. The FICO score is what mortgage lenders and others look at.

If you want a copy of your FICO score, your best bet is to go to the Fair Isaac site (the owners of FICO) and pay for it. The official website is http://www.myFICO.com