Loan and Credit Card Extras

You call your credit card company to check your balance and are offered extra services.

These additional products and services may be beneficial to certain consumers, but how can you tell if that second offer from your bank may be right for you? Here are two products that are commonly offered, plus information to keep in mind.

"Payment protection," also known as credit protection, is designed to pay, suspend or cancel a consumer's outstanding debt on an account in the event of a specific hardship, such as unemployment, disability, hospitalization or death. These products may provide security and peace of mind, but understand the costs and the limitations. You could also consider traditional life or disability insurance.

“Identity theft protection” will monitor your credit reports for signs that someone may be attempting to use your name to commit fraud. This
service generally is billed monthly and some companies send you a monthly report even if they did not notice suspiciuos activity. There are also ways you can monitor your credit. Remember that you are entitled to one free credit report once every 12 months from each of the three major credit bureaus. By spreading out your requests throughout the year — such as by ordering one credit report in the first few months of the year and another report from a different credit bureau a few months later — you can actively monitor your credit report. Look for warning signs of identity theft, such as loan requests or new accounts you didn't initiate. At a minimum, however, you should order a report once a year. If you're already a victim of identity theft, you may want to place a fraud alert in your file at all three credit bureaus. This warns lenders to be careful before approving a new loan or credit card in your name.

Source: FDIC