Credit monitoring services: Should you buy them?

Your credit history and credit scores can be two keys to unlocking opportunities like a mortgage, personal loan or even renting an apartment. That’s why keeping tabs on your credit reports to quickly identify any unusual changes is important. 

Luckily, there are services that can help. Read on to learn more about credit monitoring services.

Key takeaways

• Credit monitoring services alert you to changes or potentially fraudulent activity in your credit reports.
• Some credit monitoring services do more than just monitor your credit reports.
• Credit monitoring services don’t prevent or resolve fraud or identity theft. 
• You can receive a free annual credit report from each of the three major credit reporting companies.

A credit monitoring service alerts you to any changes to your credit reports—including ones that could affect your credit scores. 

These services alone can’t protect you from identity theft or someone opening a new line of credit in your name. But they can sound the alarm when suspicious activity occurs, which may help you address the issue in a timely fashion.

There are many options for monitoring your credit, including free services like CreditWise from Capital One. CreditWise is free for everyone, even if you don’t have a Capital One credit card. And using CreditWise won’t hurt your credit scores.

Credit monitoring services might track your credit reports for changes, which can include:

• Hard credit inquiries
• New accounts or lines of credit
• Unusual updates to your name, address and other personal information
• Credit score fluctuations
• Late payments on accounts

Some credit monitoring services may offer even more services.

A standard home smoke detector will alert you to potential danger, but it can’t dial 911—that’s up to you. A credit monitoring service works in a similar way: It alerts you to changes to your credit report that could affect your credit scores. But you’re responsible for taking the necessary steps to resolve any potential identity theft issues.

Some credit monitoring services go a step beyond. Take CreditWise: It monitors threats beyond just those to your credit reports. It can track your Social Security number, scan the dark web and send you automatic alerts from two credit bureaus—all for free.

The prices of credit monitoring services vary. And according to the Consumer Financial Protection Bureau (CFPB), companies might charge monthly fees of $15 or more. But there are also free options to consider.

Depending on your circumstances, it may not be worth paying for credit monitoring services. Unless you’re looking for enhanced credit protection—like identity theft insurance—free options like CreditWise may be able to support your needs. 

CreditWise can send alerts when changes to your TransUnion® credit report occur. It can also provide you with access to your VantageScore 3.0 credit score. And remember: It’s free, and using it won’t hurt your credit scores.

In addition to a tool like CreditWise from Capital One, you can monitor and protect your credit by taking some of the following steps:

• Get free copies of your credit reports once a year from each of the three major credit bureaus: Equifax®, Experian® and TransUnion. You can learn more at AnnualCreditReport.com.
• Sign up for any fraud and purchase alerts your credit card issuer may offer.
• Review your monthly statements for unauthorized charges. 
• Freeze your credit account when you see fraudulent activity. This step can make it difficult for a criminal to open a new line of credit in your name.

It’s important to be aware of threats, such as identity theft and fraud. A credit monitoring service is one way you can help protect yourself.

Like most things, it’s important to do your research and understand what you are signing up for. The CFPB recommends learning about the features and potential hidden fees of any credit monitoring service you’re considering. You just might find that a free credit monitoring tool is all you need.