Identity thieves can open loans in your name. This form of fraud damages credit scores and creates legal complications. Here's what to do if it happens to you.
Start by checking your credit reports immediately. Pull free reports from all three bureaus (Equifax, Experian, TransUnion) at annualcreditreport.com. Look for accounts you don't recognize, especially loans, credit cards, or student loans opened recently.
Next, place a fraud alert with the credit bureaus. This alert forces lenders to verify your identity before approving new credit in your name. Call one bureau and ask them to notify the others. The alert lasts one year and is free.
File a report with the Federal Trade Commission at identitytheft.gov. The FTC creates a recovery plan and generates an Identity Theft Report that proves the fraud occurred. Give copies to creditors and lenders when disputing fraudulent accounts.
Contact the lender holding the fraudulent loan directly. Explain the situation and provide your FTC Identity Theft Report. Request they close the account and reverse any charges or payments made. Get the lender's fraud department contact information in writing.
Dispute the fraudulent accounts with each credit bureau in writing. Send letters with copies of your FTC report and proof of the fraud. The bureaus must investigate within 30 days and remove inaccurate information from your report.
Monitor your accounts going forward. Check credit reports quarterly and set up fraud alerts on bank accounts. Consider a credit freeze, which blocks access to your credit report entirely. This prevents new accounts from opening without your explicit permission.
File a police report if the fraud involves significant money. Some lenders require this documentation. Get a police report number for your records.
Keep detailed records of everything. Save correspondence with lenders, credit bureaus, and law enforcement. Document phone calls with dates and names.