Speak to a Mortgage Advisor by clicking below..
What is Identity Theft?
Identity theft is a serious crime that can have devastating consequences for individuals.
It involves the theft of personal information, often leading to financial fraud and other fraudulent activities.
One of the concerns that people who have experienced identity theft may have is whether it will impact their ability to obtain a mortgage.
In this comprehensive guide, we will explore the effects of identity theft on mortgage applications and provide valuable information on how to navigate this situation.
1) It’s possible to get a mortgage after experiencing identity theft, but it can make the process more challenging due to potential impacts on your credit and financial history. Addressing the issue and resolving inaccuracies on your credit report may be necessary before applying for a mortgage.
2) Identity theft involves the unlawful acquisition and use of someone’s personal information for fraudulent purposes, often leading to identity fraud and severe consequences. It can damage credit scores, hinder access to credit, and cause significant stress.
3) While identity theft can complicate the mortgage application process, it does not automatically disqualify you. Lenders have procedures to handle such situations. Your eligibility depends on various factors, including the extent of the fraud, your actions to rectify it, and your overall creditworthiness.
4) If you’ve experienced identity theft and plan to apply for a mortgage, take immediate steps like reporting the theft to authorities, notifying your bank and creditors, obtaining and reviewing your credit report, adding a Notice of Correction for added security, monitoring your credit, and rebuilding your credit history.
Can I Get a Mortgage If I’ve Had Identity Theft?
Yes, it is possible to get a mortgage even if you’ve experienced identity theft.
While identity theft can indeed complicate the mortgage application process, it does not necessarily mean that you will be disqualified from obtaining a mortgage.
However, it is important to note that each case is unique, and the impact of identity theft on your mortgage application will depend on various factors, such as the extent of the fraud, the steps you have taken to rectify the situation, and your overall creditworthiness.
It is crucial to be proactive and take the necessary steps to repair your credit and demonstrate your financial responsibility to lenders.
Can My Case Be Referred To The Underwriters?
Yes, if you have sufficient proof of your identity fraud and the impact on your credit score, your mortgage application can be referred to the underwriters for review.
By doing this, the underwriters may agree to assess your case on a previous credit score and apply certain conditions to your mortgage such as the requirement for a larger deposit so it can be accepted.
It is worth noting that not every Lender will review your case manually, and you may be limited to just Specialist Lenders in some cases.
Steps to Take After Identity Theft?
If you have been a victim of identity theft and are planning to apply for a mortgage, there are several steps you should take to mitigate the impact of the fraud and increase your chances of mortgage approval. These steps include:
Report the Identity Theft
As soon as you become aware of the identity theft, it is essential to report it to the relevant authorities and your local law enforcement agency.
In the UK, you should contact Action Fraud, the national fraud and internet crime reporting centre.
They will provide you with a crime reference number, which can be used to support your case and dispute any fraudulent information on your credit report.
Notify Your Bank and Creditors
Contact your bank and credit card issuers immediately to inform them of the identity theft. They can help safeguard your accounts and monitor for any suspicious activity.
Additionally, notify any other relevant financial institutions or creditors where fraudulent accounts may have been opened in your name.
By taking swift action, you can mitigate the impact of the fraud and prevent further damage to your credit.
Obtain and Review Your Credit Report
Obtain a copy of your credit report from one of the three main credit reference agencies in the UK, such as Experian, Equifax, or TransUnion.
Carefully review the report for any fraudulent accounts, inquiries, or other suspicious activity. If you identify any discrepancies, promptly dispute them with the credit reference agencies and provide them with the necessary supporting documentation.
Add a Notice of Correction to Your Credit Report
To further protect yourself from future fraudulent activities, consider addinga Notice of Correction to your credit report.
This involves providing a password that lenders will need to confirm your identity before approving any credit applications in your name.
Adding this extra layer of security can help prevent unauthorized access to your credit and reduce the risk of further identity theft.
Monitor Your Credit Regularly
After experiencing identity theft, it is crucial to remain vigilant and monitor your credit regularly.
Keep a close eye on your credit reports from all three credit reference agencies and review your bank and credit card statements for any suspicious activity.
Promptly report any unauthorized transactions or accounts to the relevant institutions and take immediate action to rectify the situation.
Build a Strong Credit History
Rebuilding your credit history after identity theft is essential for demonstrating your creditworthiness to lenders.
Focus on making timely payments on existing accounts, keeping your credit utilization low, and avoiding unnecessary new credit applications.
By maintaining a positive credit history, you can improve your chances of being approved for a mortgage in the future.
Tips to Avoid Identity Theft
Here are some tips on how to prevent identity theft, including being cautious about sharing personal financial information like your sort code and account number:
Protect Personal Information:
Safeguard your personal information, including your Social Security number, bank account numbers, and passwords. Avoid sharing sensitive details online unless it’s necessary, and ensure that the websites you use are secure.
Use Strong Passwords:
Create strong, unique passwords for your online accounts. Use a combination of letters (both upper and lower case), numbers, and special characters. Avoid easily guessable passwords like “password123.”
Enable Two-Factor Authentication:
Whenever possible, enable two-factor authentication (2FA) on your online accounts. This adds an extra layer of security by requiring you to enter a temporary code sent to your mobile device.
Secure Your Mail:
Collect your mail promptly, especially financial statements, credit card offers, and other sensitive documents. If you move, update your address with financial institutions and the post office.
Shred financial documents, credit card statements, and any paperwork containing personal information before disposing of them. This prevents dumpster divers from accessing your data.
Monitor Your Credit:
Regularly check your credit reports for suspicious activity. You’re entitled to one free credit report from each of the major credit bureaus annually.
Be Wary of Phishing Emails:
Be cautious when clicking on links or downloading attachments from unsolicited emails. Scammers often use phishing emails to steal your personal information.
Secure Your Devices:
Protect your computer and mobile devices with up-to-date antivirus and anti-malware software. Use a secure and unique PIN or password to lock your phone and computer.
Use Secure Wi-Fi Networks:
Avoid using public Wi-Fi networks for financial transactions or accessing sensitive information. If necessary, use a virtual private network (VPN) for added security.
Be Cautious with Personal Checks:
Don’t leave outgoing mail with checks or other sensitive information in your mailbox. Criminals can steal checks and alter them.
Secure Your Social Media Profiles: Review and adjust your social media privacy settings to limit the personal information visible to the public. Be mindful of what you share on social platforms.
Monitor Your Accounts:
Regularly review your bank and credit card statements for unauthorized transactions. Report any suspicious activity to your financial institution immediately.
Protect Your Sort Code and Account Number:
Be very cautious about sharing your Sort Code and Account Number.
Only provide this information to trusted entities, and avoid sharing it through email or over the phone unless you initiated the contact.
Experiencing identity theft can be a distressing and challenging ordeal. However, it does not have to permanently derail your dreams of homeownership.
By taking immediate action, reporting the fraud, and diligently repairing your credit, you can overcome the hurdles caused by identity theft and increase your chances of qualifying for a mortgage.
Remember to remain proactive, monitor your credit regularly, and seek professional assistance if needed.