A thumbprint with a lock with a wrench, and the words "Repair Credit after Identity Theft"

Technology, for the most part, is great. It helps you get things done quickly and efficiently. But technology is not without its faults. For one thing, it makes people susceptible to hacking, like the 150 million American consumers affected by 2017’s massive Equifax hack, which puts people at risk for identity theft for the remainder of their lives.

While the Equifax hack is one of the biggest and most recent examples of mass identity theft, it’s hardly the only case. A 2017 Identity Fraud Study from Javelin Strategy & Research states that about 15.4 million Americans were victims of identity theft in 2016, and about $16 billion was collectively stolen from said victims.

Identity theft is more common than you might realize, and you could become a victim at any time. Should that day come, you should know how to repair the damage that identity theft can cause. One of the most important things you need to be aware of after identity theft is the toll it can take on your credit score. Here’s how you can reduce the damage:

Contact Your Lenders Immediately

Hopefully, the activity was minor. And hopefully, you have fraud alerts set up for your important accounts. In any case, you should promptly contact your lenders and notify them of any fraud you notice. In some cases of credit card fraud, they’re able to immediately deactivate the card and reimburse you for the expenses that someone else incurred. Some of your lenders may even contact the major credit bureaus on your behalf to let them know of the situation.

Check Your Report

You’re granted one free credit report per year from each of the three main credit reporting bureaus (Equifax, Experian, TransUnion), and you should take advantage of this to make sure that there’s no unusual activity. Even if you don’t believe that you’ve been hacked and there is no evidence of fraudulent activity, keep in mind that as many as 20 percent of all Americans have some sort of error on their credit report, so it’s good to get into the habit of checking this annually. Take note of inaccuracies (whether they’re from identity theft or something else) and file a dispute with the credit bureaus. If you’re disputing fraud, it helps to include any police reports you may have filed as well as any documentation from your lenders. Upon verifying your claims, any fraudulent items should be quickly removed. Once these negatives affecting your score are removed, your score should improve.

Take Further Measures

Getting your credit stolen is no fun. The good news is that there are steps you can take to prevent it from happening again. If you’re seriously concerned about your information being compromised again, you can enact a credit freeze. This essentially means that your account is put on hold and you won’t be approved for any new lines of credit unless you unfreeze it. It’s a good way to make sure that you – and only you – are the one influencing your score. You can also set up fraud alerts with the credit bureaus, which essentially add verification steps for lenders that are setting up lines of credit so the credit bureaus are sure that the credit is for you and not someone pretending to be you. Make sure to set up credit freezes and fraud alerts with all three credit bureaus to ensure full protection.

How to Increase Your Credit Score

Say you get your identity theft issue cleared up, but you’re still unhappy with your credit score. Here’s a look at some of the best ways to increase your score in a relatively short period of time:

  • Watch your credit utilization ratio: Your credit utilization ratio, or your debt-to-credit limit ratio, can influence your overall credit score. For a better score, keep this number at or below 30 percent. For instance, if you have only one credit card with a maximum limit of $10,000, spending only $3,000 or less will ensure the best score.

  • Pay bills on time: Paying bills on time won’t really improve your credit score, but failing to do so can really hurt it. If you’ve been guilty of late payments recently, commit to making on-time ones. The longer you go without missing a payment, the more it will negate your previous missed payments.

  • Pay down debt: A good debt management plan is crucial to increase your credit score. However, this takes discipline and managing your priorities. To improve your credit score, you may have to cut back on some things.

For more information on building up your credit score, visit Build My Scores today.