You probably have never given much thought to your young child’s credit history and rating. However, the increase in identity theft means dads have to be more vigilant about protecting their kids from thieves who will take their financial identity, often not to be discovered for many years. As crises go, this one isn’t earth shattering, but the Federal Trade Commission, the federal agency that tracks identity complaints, says that 11,600 complaints for victims under 18 were filed in 2005. This is roughly double the number filed in 2003. Many of these are fraud cases involving relatives, but some involve real theft too.
What can dads do to protect their kids?
1. Guard their social security number. Social security numbers should only be given out for financial and tax purposes, and medical reasons; so ask yourself whenever anyone (school, community groups) demands your child’s social security number. That goes for parents as well. At some point, the social security number could become a national ID number, but this has not yet occurred.
2. Understand how someone could use his or her number, so you understand why a child with no credit could be a target. Anyone working needs a social security number.
3. Watch the mail. Is your son or daughter suddenly getting mail solicitations for credit cards and loan products? This may be a warning sign that someone has used his or her number and your child has been identified as financially mature.
4. It’s not a bad idea to consider checking your child’s credit report, which you can do for free each year. You can also place a fraud alert on their records, but that has to be renewed every 90 days. Companies exist, like LifeLock (www.lifelock.com) that will track your credit and can add your children to their alerts. These are checks you can do for free by asking for a credit report, but may be worth the fees ($10 per month plus add-on of $25/year per child) if you are concerned.
An allowance for kids is an important part of growing up and plays a significant role in developing the ability to manage money. A few things for parents to keep in mind while choosing how much allowance for kids.
By: P. Banas
Posts Tagged ‘Social Security Number’
Kids, Credit and Credit Ratings
March 29th, 2010Posted in Articles
Tags: Bad Idea Community Groups Credit History Crises Federal Trade Commission Financial Identity Fraud Alert Fraud Cases Lifelock Loan Products Mail Solicitations Medical Reasons National Id Number Social Security Social Security Number Social Security Numbers Target Tax Purposes Thieves Warning Sign
How To Clear Your Credit Report
March 18th, 2010
If you’re being turned down for credit left and right by every mortgage broker, credit card company, and landlord, or you’re not even able to refinance your own house, that is an indication that you have some negative items on your credit report that are scaring away lenders. You have two choices: You can either walk away and decide to wait out the next seven years until those negative items drop off your credit report, or you can take control over the situation and learn how to delete negative items from your credit report.
You may have seen those advertisements where those law firms or credit counseling companies promise to fix your credit, raise your FICO score, and get you a fresh start. How do you delete negative items from your credit report? The answer is based on a law passed by Congress in the latter half of the twentieth century known as the Fair Credit Reporting Act. This law was passed to protect consumer’s rights to access their credit report and play an active role in ensuring that it does not contain any inaccuracies or misrepresentations of your true credit profile.
If you have derogatory information contained in any of the credit reports issued by the “big three” credit bureau, you simply need to write a letter to each respective creditor disputing the accuracy of that particular entry in your credit report. By law, then the bureau must contact the creditor to verify that specific item that is in dispute. And here is where the law works in your favor: If the bureau is unable to verify the accuracy of the information within 30 days, they are required to delete that item from your credit report altogether!
Here is an example of how you would do this: Let’s say that you were late for your mortgage payment in May of last year, you simply write a letter to the credit bureau that is reporting that late payment, detailing that entry, and including your name, address, and social security number, in which you state that in accordance with the Fair Credit Reporting Act, you are disputing such and such entry as you believe it may be inaccurate. And in this letter, you must state that, in accordance with the Act, if the agency does not verify this information within 30 days, then they are required to delete the information from your credit report.
Now what if the bureau is able to contact the creditor and verify the information within the 30-day timeframe? Well, then the information stays on your credit report. What if the creditor is a little slow but gets back to the bureau within 45 days? Then yes, even though the bureau deleted the item after 30 days, the information can be added back in the subsequent month. But through patience and persistence, if you follow this method, you will eventually be able to improve your credit score. There is no 100% guarantee, however, which is why shouldn’t pay anyone to fix your credit for you, unless they offer a money back-guarantee if your credit score doesn’t improve within a specific period of time.
A couple of bits of advice: Write one separate letter to each bureau for each disputed item. For example, if you have five derogatory items on your report, that were reported to all three bureaus, then you should write fifteen letters. This way you can track the progress of each dispute, plus it guarantees that the credit agency will pay individual attention to each one. Give them more paperwork to process and they will be that much more backlogged to meet their thirty-day deadline.
And one final bit of advice: The Fair Credit Reporting Act also allows the bureaus to disregard your dispute if it s frivolous in nature. In other words, if you do something to cause them to suspect that you are just filing disputes that you know are more than likely to be accurate, just for the sake of flooding them with requests, then they can disregard your inquiry and not take it seriously. Therefore, be careful not to do things like repeatedly dispute the same item over and over again if it keeps on getting verified. The law was passed to protect the legitimate needs of consumers against credit fraud or data entry errors.
By: Hyder Khan
Posted in Articles
Tags: Credit Bureau Credit Counseling Credit Profile Credit Report Credit Reporting Act Creditor Fair Credit Reporting Act Fico Score Fresh Start Inaccuracies Landlord Law Firms Misrepresentations Mortgage Broker Mortgage Payment Seven Years Social Security Number True Credit Twentieth Century Two Choices
Don’t Fall Victim To Credit Repair Scams
March 3rd, 2010
If you suffer from poor credit, you’ve probably seen advertisements for credit repair services. Many ads for credit repair services claim to be able to remove bankruptcies, create new credit identities, and even erase bad credit.
Beware! Many of these credit repair companies exist only to cheat money out of their customers. Many people have paid hundreds of dollars in fees, only to find that these credit repair companies simply vanish because they can’t deliver what they have promised. Don’t be fooled, the only real way to improve your credit report is with time, effort, and a good payment history.
But if you decide to try out a credit repair service, there are certain warning signs you should look for to decide if the company is legitimate. A credit repair service should not want you to pay for credit repair services before any services are provided. Another warning sign is if a credit repair service recommends that you not contact the credit bureau directly or refuses to answer questions about your legal rights as a debtor.
Some phony credit repair services will advise you to creat a new credit identity by applying for an Employer Identification Number to use instead of your Social Security Number. If you follow this illegal advice you may be commiting fraud, and find yourself facing prosecution. It’s a federal crime to make false statements on a loan or credit application, to misrepresent your Social Security Number, or to obtain an Employer Identification Number from the IRS under false pretenses.
While no one can legally remove accurate and timely negative information from a credit report, the good news is that the law does allow you to dispute information on your credit report that is inaccurate or incomplete. According to the Fair Credit Reporting Act, you can dispute mistakes or outdated items for at absolutely no cost to you. Just ask the credit reporting agency for a dispute form and/or submit your dispute in writing. Include supporting documentation, clearly identify each item in your report that you dispute, explain why you dispute the information, and request a investigation be done. Make sure you remember to keep a copy of the dispute for your records. If the new investigation reveals an error, you can ask that a corrected version of the report be sent to anyone who received your report within the past six months. If the reinvestigation does not resolve your dispute, you can have the credit bureau include your version of the dispute in your credit report.
Luckily, many states have laws regulating credit repair companies. So, if you believe you have been cheated by a fraudulent credit repair service, don’t hesitate to report the company to your local consumer affairs office or your state attorney general.
By: Dave Robinson
Posted in Articles
Tags: Credit Bureau Credit Identity Credit Repair Companies Credit Repair Scams Credit Repair Service Credit Repair Services Credit Reporting Act Credit Reporting Agency Debtor Employer Identification Number Fair Credit Reporting Act Fall Victim False Pretenses False Statements Federal Crime Payment History Social Security Number Time Effort Warning Sign Warning Signs
