6 Steps to Handle An Unauthorized Credit Inquiry

A credit inquiry you do not recognize on your credit report can be a red flag for fraudulent activity. This article identifies six important steps to help safeguard your personal finances after you notice an unauthorized credit inquiry.

#1. Confirm the Inquiry with the Creditor

Contact the company identified as having made a hard inquiry (hard pull) on your credit report and request documentation indicating the request. If the conversation reveals you did not authorize the inquiry, or it is erroneous, ask the company to notify the credit bureaus to remove the inquiry. Take notes and hold on to all documentation and communication for future reference.

A soft inquiry is not visible to other creditors and does not impact your credit score; therefore, no action is required. However, a hard credit inquiry that arises when you actively request a new credit card or auto loan can impact your credit score. Hard inquiries are visible to other creditors conducting credit checks and should be scrutinized.

See “Understanding Hard vs. Soft Credit Inquiries” for more information about the two types of inquiries.

#2. Check All Credit Reports

The big three credit reporting agencies—Experian, Equifax, and TransUnion— contain nearly identical information, but there are slight differences in what they report. Request your free credit reports from annualcreditreport.com, and review them to look for other suspicious activity. If there is suspicious activity, #1 above can guide you in contacting any credit card companies or businesses associated with additional questionable inquiries.

#3. Alert the Major Credit Bureaus

To remove the inquiry from your credit report, file a dispute with the credit reporting agencies. Send a dispute letter or follow the links below to file an online dispute.

#4. Protect Yourself from Future Unauthorized Credit Inquiries

A credit freeze is one of the main tools used by consumers to protect themselves against identity theft or to limit damage from credit thieves. It protects you against scammers and credit card fraud by blocking credit card issuers from accessing your information. A credit freeze placed on your credit reports prevents the credit bureaus from sharing your credit information with any third parties.

You can also place a fraud alert with the credit bureaus. The alert appears on your credit report and requires verification before extending credit in your name. Setting a credit freeze or fraud alert is free and does not impact your FICO score. 

#5. Monitor and Protect Your Credit Score

A credit freeze is one of the main tools used by consumers to protect themselves against identity theft or to limit damage from credit thieves. It protects you against scammers and credit card fraud by blocking credit card issuers from accessing your information. A credit freeze placed on your credit reports prevents the credit bureaus from sharing your credit information with any third parties.

You can also place a fraud alert with the credit bureaus. The alert appears on your credit report and requires verification before extending credit in your name. Setting a credit freeze or fraud alert is free and does not impact your FICO score. 

#6. Understand Your Credit Protections

You are not alone when it comes to protecting your credit. United States citizens have certain protections against unfair, deceptive, or abusive financial practices. The U. S. government makes sure banks, lenders, and other financial institutions and companies treat consumers fairly.

• Consumer Financial Protection Bureau. The CFPB is the single point of accountability for enforcing federal consumer financial laws and protecting consumers in the financial marketplace.
• Fair Credit Reporting Act. The FCRA is a federal law to protect consumers by requiring accurate and fair credit reporting, and it gives consumers the right to dispute errors.
• com. This is the only source authorized by Federal law to get a free copy of your credit reports.
• Federal Trade Commission. The FTC manages gov to help you report and recover from identity theft.

In Conclusion

If your research indicates you are a victim of identity theft, file a report with the FTC and your local police department.

If you have other questions about protecting your credit history, check out our online Advice Center.  Let TDECU help you with credit repair and credit building -- contact one of our expert TDECU Wealth Advisors today.

Sources:
https://www.investopedia.com/terms/c/credit-freeze.asp