Someone took out a loan in your name. Now what?

Identity theft has many different faces. From credit cards to student loans, thieves can open various forms of credit in your name and destroy your credit history and financial situation in the same way.

If this happens to you, it can be difficult and time-consuming to rectify the situation. But you can fix everything.

If someone has taken out a loan in your name, it is important to take immediate steps to prevent further damage to your credit. Follow these steps to protect yourself and get rid of fraudulent accounts.

1. File a report with the police.

The first thing you need to do is apply to your local police station. You may be able to do this online. In many cases, you will need to provide a police report confirming the theft in order for lenders to remove the fraudulent loans from your account.

2. Contact the lender.

If someone has taken out a loan or opened a credit card in your name, contact the lender or credit card company directly to notify them of the fraudulent account and remove it from your credit report. For credit cards and even personal loans, the problem is usually resolved quickly.

When it comes to student loans, identity theft can have huge consequences for the victim. Failure to pay off a student loan can result in withholding of wages, suspension of your license, or the government seizing your tax refund – so it is imperative that you stop any fraudulent activity and repay your loan quickly.

Typically, you need to contact the student loan lender and provide them with the police report. The lender will also ask you to complete an identity theft report. While your discharge application is pending, you are not responsible for payments.

If you have private student loans, the process is similar. Each lender has its own process for handling student loan identity theft. Usually, however, you are asked to provide a police report as evidence and the creditor will investigate.

3. Notify the school if necessary.

If someone took out student loans in your name, contact the school where the thief borrowed the loan. Call their financial aid or the registrar’s office and explain that the student took out a loan in your name. They can flag an account on their system and prevent anyone from borrowing with your information.

4. Discuss mistakes with credit bureaus.

When you find evidence of fraudulent activity, you need to dispute the errors with each of the three credit reporting agencies: Experian, Equifax, and TransUnion. You must contact each of them and provide proof, such as a police report or a letter from the creditor, confirming the identity theft. Once the credit bureau receives this information, they can remove the accounts from your credit history.

If your credit score is hurt because thieves have defaulted on your loans, removing them can help improve your score. It may take weeks or even months for your account to fully recover, but it will eventually be restored to its previous level.

5. Post a fraud alert or freeze your credit report.

Once you find that you have been the victim of a fraudulent loan, post a fraud notice on your credit report with one of three credit reporting agencies. You can do it online:

When you post a fraud alert on your account, potential lenders or lenders will be notified when they start using your loan. The warning invites them to take additional steps to verify your identity before issuing a loan or loan in your name.

In some cases it might be a good idea freeze your loan… With a loan freeze, lenders cannot view your credit report or issue you a new loan until you cancel the freeze.

6. Check your credit report regularly.

Finally, check your credit report regularly to make sure no new accounts are being opened in your name. You can request a free report from each of the three credit agencies once a year at AnnualCreditReport.com… You can alternate reports to shoot once every four months, which will help you keep a close eye on your account activity throughout the year.

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