Initial Versus Extended Fraud Alerts: Which Is Best For You?

Upon learning that your identity has been seriously compromised by an unscrupulous crook, there are several steps that you as a consumer must take quickly in order to help clear up the situation with your bank, with your creditors and with the credit bureaus who are generating reports on you. These initial actions should be taken within the first 48 hours, once you have learned that someone may be hijacking your identity.

So, what happens, then? In addition to making those contacts to clear up the situation, consumers should consider one of the following actions with one or more of the credit bureaus:

Place an initial fraud alert which will stay on your credit report for at least 90 days. This is appropriate if your wallet has been stolen or if you have been taken in by a "phishing" scam. This means that potential creditors must use what the law refers to as "reasonable policies and procedures" to verify your identity before issuing credit in your name. Now, an initial fraud alert entitles you to one free credit report from each of the three consumer reporting companies.

Place an extended fraud alert which will stay on your credit report for seven years. You must then provide the consumer company with an Identity Theft Report. Any potential creditors who are considering extending credit in your name, must actually contact you, or meet with you in person, before they issue any credit in your name. In addition, an extended alert entitles you to two free credit reports within twelve months from each of the three nationwide consumer reporting companies.

What Are The Drawbacks of Fraud Alerts?
As mentioned above, depending on the type of fraud alert you place with the credit bureaus, potential creditors must either contact you or take reasonable steps to verify your identity. These additional steps may sometimes cause some delays in getting your money if you, yourself, are trying to obtain credit in the ensuing months or years after placing an idenity theft alert.

So, in order to make allowances for these possible delays, you may wish to include a cell phone number in your alert so that you can be reached easily and quickly when a potential creditor starts to analyze your request for credit. Consumers must then remember to keep tabs on the alert by updating all personal contact information in the theft alert so that it is always current.