Mortgage interest rates are inherently variable. They fluctuate based on economic factors, both global and domestic, housing supply and demand for a particular area, and the credit score of the borrower.
There’s not much an individual borrower can do to stabilize the national economy. You can be smart about when and where you look for a home and make informed choices about what you can afford. But the major determining factor of mortgage interest rates that you have the most control over is credit score. (more…)
Protect Your Credit With These Seven Effective Tips
In the current economic climate, credit is more important than ever in the process of lender decision-making. Unfortunately, credit is also more vulnerable than ever to being stolen, tampered with, or breached due to the widespread accessibility of the Internet and significant advances in modern technology.
When our society relies so heavily on a form of financing that is rather susceptible to foul play, how do you ultimately protect yourself? Luckily, taking certain precautionary measures can dramatically lessen your chances of becoming another statistic in identity theft or credit card fraud. Here are several simple steps you can take to protect your finances and your identity.
Seven Steps For Protecting Your Credit
- Go Prepaid for Online Shopping
Kim Zetter from Wired.com points out that using prepaid, loadable credit or debit cards for internet purchases can add a thick layer of security over your actual finances. You can load an approximate amount onto the card that will cover the purchase in question, and after the funds have been withdrawn, you can banish the card for good. If you shop online frequently, you can also keep it around for future uses. Likewise, you can use pseudo credit card numbers to mask your real numbers. Financial institutions such as Bank of America, Citi Bank, and Discover offer this type of service because if online hackers can carry false or mysterious identities, then you should be able to as well.
- Check Your Credit Card Activity Often
These days, you don’t have to wait for your credit card statement to come around through postal mail to know exactly what’s going on with your credit activity. You can log on to the credit card company’s website and observe the activity in real time. Larry Magid from Forbes.com urges consumers to stay on top of their credit by checking their accounts on a regular basis. Of course, you will always see a virtual general breakdown of purchases and payments that you have made in the past. However, if you notice any unusual or unfamiliar activity, it is suggested that you notify the credit card company immediately.
- Use a Fraud Alert to Your Advantage
Fortunately, you have the option of placing a fraud alert on your credit report if you either sense suspicious activity or want to strengthen the protection of your finances. Credit bureaus often offer this feature free of charge, and Richard Barenblatt from Who Lends Here notes that it can protect you from disastrous scenarios that may happen down the road. Once the fraud alert has been placed on your account, lenders will need to go through a rigorous set of steps to confirm your identity before lending money or opening new lines of credit. This might be a bit of a nuisance for you, but imagine how useful it will be if a criminal attempts to steal your identity. This is why a fraud alert is completely necessary.
- Avoid Identity Theft Protection Services
These days, almost any credit card company can be a provider of identity theft services, and these services are apparently the “be-all end-all” of your finances. These companies use scare tactics to convince consumers that they will eventually become victims of identity theft without their paid protection. What’s worse is that companies will charge anywhere from $100-$300 for annual coverage. What consumers don’t know, however, is that it is rather easy to do what these companies are doing for virtually no cost. If you ever come across an offer from a reputable company for free credit monitoring, Consumer Reports urges you to take advantage of it. If the service is only offered for a limited period of time, be sure to cancel before it before the trial ends.
- Know How to Identify a Phishing Scam
For many victims of fraud, the entire fraud process typically starts with a suspicious-looking email. In order to identify the scams these emails contain, follow these tips provided by Consumer Reports:
- Examine the sender. You should immediately take precaution with emails that originate from unknown or fishy sources.
- Study the content. Is the body of the email littered with grammatical errors? Emails originating from trusted sources will almost never have any sort of errors in spelling or grammar.
- Determine what type of information is being requested. Specifically, if you are being urged to return lots of information about yourself (namely your name, address, phone number, date of birth, gender, etc.), avoid the email at all costs.
- Hover over links before clicking them. This will help you determine the real destination of the link in question. If you’re being urged to click a link originating from your bank or credit card company, visit their website instead and navigate to the website section from there. As a rule of thumb, you should avoid clicking links in emails at all costs.
- Avoid emails that request money in return for even more money. This type of scam can take many shapes and forms, but they all possess the same principle once they’ve been watered down.
- Use Cash, Cash, and More Cash
USA Today reminds consumers that one of the only tried-and-true ways you can protect your credit is to use cash whenever possible. If you can avoid swiping your card, then it might be best to just leave it in your wallet. Even though security analysts work around the clock to strengthen retail databases, there are also hackers working the same amount of hours learning how to break these defenses down. Therefore, it might pay to make more frequent stops at your bank ATM.
- Get a Free Annual Credit Report
Lastly, you should always take advantage of a free periodic credit report offered by AnnualCreditReport.com. Occasionally checking in on your credit report will keep you updated on any suspicious activity, and you can immediately report it to the credit bureaus and associated lending companies as soon as you notice it. You can pay a bit out of pocket to keep closer tabs on your credit, but this should only really be necessary if you’ve had problems with fraud in the past or if you suspect that there is currently foul play at work.
One Step To Learning More
Your credit is not just important for the home buying process: it is important for many other significant decisions and purchases you may want to make at any time in life. Therefore, it is essential to do whatever you can to protect your credit, so to learn more about how your credit comes in to the home buying process as well as more about how you can protect your credit, contact Chris Doering Mortgage today.