Time’s running out to register for free credit monitoring

Some 24 million consumers pay $120 to $180 a year for credit monitoring, according to Javelin Strategy and Research, a California-based consulting firm. These services alert you when new accounts, negative information, credit-limit changes, and other items appear on your credit report, which could be signs that someone is fraudulently using your identity. You, however, may be among 190 million consumers eligible to get the service free from TransUnion for six to nine months. But you have to act fast and sign up by Sept. 24, 2008.

The deal is part of a class action lawsuit settlement with TransUnion, one of the big three credit bureaus, and Acxiom, a data processing company. The pair is alleged to have improperly sold credit file information for the past 20 years to target marketers, the folks who interrupt your dinner and clutter your mailbox with sales pitches. Both companies deny any wrongdoing.

You’re eligible for six months of free TransUnion credit monitoring if you had an open credit account or line of credit any time between Jan. 1, 1987 through May 28, 2008. (Alternatively, you can opt for nine months of free service, if you surrender certain rights to a possible future cash payment, but we don’t recommend this.)

Once you register, you’ll have six more months after the court approves the settlement to actually activate the free credit monitoring. If you’re paying for a credit monitoring service now, be sure to cancel that when you sign up for the freebie.

Ordinarily, we don’t recommend paying for credit monitoring, because these services offer limited protection and there are other things you can do to protect yourself from ID theft at low or no cost. If it’s free, though, it’s worth it to sign up. But don’t get suckered into subscribing after the free period is up. Remember also that this deal gives you free access only to your TransUnion credit report; your Equifax or Experian credit reports are not included. Since lenders don’t always report to all three credit bureaus, this settlement might not give you complete coverage of your credit profile.

The settlement also gives you free TransUnion TransRisk brand of credit scores. Lenders, however, often use other credit scores to determine your creditworthiness and interest rate (see “Credit Scores: Which ones do lenders use?”).—Jeff Blyskal