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[05:42:18 AM Monday, September 08, 2008]
Credit Protection Programs - Who Really Needs Them?The numerous protections offered by a standard credit card - road assistance protection, purchase and fraud protections - are considered to be a great benefit and value. Freezing an account and putting an alert are especially popular considering the increased instances of ID theft and fraud. Zero liability policy in case a card has been stolen and fraudulently used is also of great significance for a regular customer. But while some standard protections go as in-built services, for example purchase protection plan and zero liability, others require sign-up fees and additional charges and do not always pay for themselves. We're speaking about the programs which claim to be able to protect one's identity and manage credit on the whole. Starting with credit account freeze. It's being marketed by all the major card-issuing companies as a great benefit for instances like unemployment or illness. A lot of customers who pay their bills in full each month wonder if it makes any sense to get enrolled. That is a noteworthy issue as the fine print on most cards states one has to be unemployed for at least 6 months before the account freeze will be actually activated. Don't forget about the fees charged for simply being enrolled. If you do not want to be an easy source of revenue to your company, make sure the credit account freeze is what you really need. The best reason to enroll would be falling victim to ID theft. Once the account is frozen, a thief will not be able to draw funds from it. Lots of people put trust in services helping manage their credit accounts. But a closer look at the programs can make a knowledgeable customer doubt as to their propriety. First, some services will allow access to a three-in-one credit report only for a charge. That is not right or at least pointless as any customer has a legal right to get that report online for free once a year at AnnualCreditReport.com. Second, why pay for credit score tracking service or monitoring your everyday transactions activity, when you can keep track of things reading your bank's monthly statements? For all these protection services you are expected to pay a flat amount each month as long as you're enrolled. Maybe, it is the price that a harrying business person or an idler has to pay for not having to do all the paperwork or a check themselves. This is not an anti-promotion of credit cards protection services but it is an outline of how much expensive and useful they are. If the price-to-quality ratio does satisfy you, go ahead - sign up and rest assured your credit management is controlled and protected. But remember most of the credit protection plans are only useful when you cannot or do not want to take matters into your own hands. Also, don't expect your FICO scores will get a boost for the fact of credit monitoring activated. Nothing is able to raise your credit scores but you with your responsible payment behavior and reasonable spending. |
