Credit monitoring services: How do they work?


Credit monitoring services can alert you when there's activity on your credit files. Is that enough to help protect you against ID theft?

Worried that someone might steal your personal information such as your address, birthdate, and Social Security number? That fear isn't unfounded.


Criminals are eager to snatch this information. Once they have it, they can use it to open new credit card accounts or take out loans in your name. They can also use your personal information to gain access to your online bank account or credit card portal.

The FCC reported that in 2020, there were nearly 1.4 million reports of identity theft in the United States. That's about two times as many reports as the FCC received in 2019.

Credit monitoring services, though, can help protect you against this threat. 

What is credit monitoring? 

Credit monitoring services watch your credit reports for any new activity. They then alert you to it.

Maybe your credit reports show that you've applied for a new credit card account. Your credit monitoring service will send you an alert. If you actually did apply for this account? There's no problem. But if you didn't? It could be fraudulent activity, the result of a scammer using your personal information to open the account in your name. 

Credit monitoring services aren't free. And you can study your credit reports for suspicious activity on your own. But paying the fees charged by a service might be worth it. You might not notice an account created in your name until after a thief has run up thousands of dollars of fraudulent purchases.

How does credit monitoring work? 

To better understand how credit monitoring services work, you must first learn about credit reports.

The three national credit bureaus of Experian, Equifax, and TransUnion each maintain separate credit reports on you. These reports list both personal and financial information.

Reports will include your full name, current and previous addresses, and Social Security number. They also
contain important financial information, such as:

Open accounts: Your report lists open credit card accounts and loans, including how much you owe on them.

“Hard” credit inquiries: When you apply for a loan or credit card, lenders and financial institutions check your credit. These inquiries, known as “hard” inquiries, show up on your credit reports.

Late and missed payments: Your reports will show any payments you made 30 days or more past the due dates on your credit card or loan accounts. These late payments remain on your credit reports for seven years.

Bankruptcy filings: Credit reports list any bankruptcy filings you’ve made. Chapter 13 filings will remain on your reports for seven years, while Chapter 7 bankruptcy filings will remain for 10.  

Foreclosures: If you fell into foreclosure on your home loan within the last 10 years, it will show up on your reports. Foreclosures do fall off your reports after 10 years.

Collections: Your reports will also show any of your accounts that have been sent to collection agencies because you’ve stopped paying on them. 

How to check your credit reports 

Normally, you can order one free copy of each of your three credit reports once a year by logging onto But during the COVID-19 pandemic, Equifax, Experian, and TransUnion are each offering these reports for free on a weekly basis.

You can check these reports for suspicious activity, such as an auto loan you never applied for or a credit card account that you can’t remember opening. These might be the sign that a thief has stolen your identity. 

But if you don’t trust yourself to remember to check your reports regularly, it might make sense to pay for a credit monitoring service.

What does a credit monitoring service do? 

A credit monitoring service will monitor your reports for you and will alert you whenever new credit card accounts or loans show up on them. This alert can help you spot the signs of identity theft quicker. You can then react faster. 

It’s important to know that monitoring the activity on your credit file is only one way to protect yourself from identity theft. Not every type of identity theft involves your credit file. Some types, including criminal identity theft, medical identity theft, and tax-related identity fraud, do not typically involve a credit check and, thus, wouldn’t necessarily be spotted through credit monitoring. 

To protect yourself against these other forms of identity theft, monitor your online bank and credit card accounts regularly. This way, you’ll discover suspicious activity faster. You might not want to rely solely on credit monitoring services to inform you of identity theft. It’s smart to take an active role in monitoring your finances for evidence of this crime.

What if you suspect identity theft? 

If a credit monitoring service finds evidence that someone has stolen your identity, the key is to act quickly.

First, if a thief has opened a new credit card account or loan in your name, call the financial services providers behind these accounts and inform them that you are the victim of identity theft. They can then close these accounts.

Check your other accounts, too, for suspicious activity. Log into your online credit card portal and search for purchases that you know you didn’t make. Check your online bank account to make sure that no one has been using it to purchase items online. And inform the providers of your existing bank accounts and credit card accounts that you have been the victim of identity theft.

You should continue monitoring your credit reports and financial accounts for signs of fraudulent purchases. The faster you spot them, the quicker you can dispute them.

It’s also smart to report identity theft to the Federal Trade Commission. You can do this at

Companies that offer credit monitoring services 

Several companies provide credit monitoring services, including NortonLifeLock, whose data and device security products and identity theft protection services go beyond credit monitoring alone.

Other companies that also provide credit monitoring services include, but are not limited to, the three credit reporting agencies — Equifax, Experian, and TransUnion.

If you’re considering credit monitoring, be sure to understand what you’re getting when you sign up. Free services exist, but they often come with limitations. And be aware that credit monitoring alone may not protect you against all types of identity theft.

Cyber threats have evolved, and so have we.

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Dan Rafter
  • Dan Rafter
  • Freelance writer
Dan Rafter is a freelance writer who covers tech, finance, and real estate. His work has appeared in the Washington Post, Chicago Tribune, and Fox Business.

Editorial note: Our articles provide educational information for you. Our offerings may not cover or protect against every type of crime, fraud, or threat we write about. Our goal is to increase awareness about Cyber Safety. Please review complete Terms during enrollment or setup. Remember that no one can prevent all identity theft or cybercrime, and that LifeLock does not monitor all transactions at all businesses. The Norton and LifeLock brands are part of Gen Digital Inc. 


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