What Is A Credit Freeze Should I Freeze My Credit
A credit freeze also called a security freeze lets you restrict access to your credit report. It enables you to take control of your financial information by preventing the release of your credit score and detailed reports by credit reporting agencies.
A credit freeze means potential creditors will be unable to access your credit report, making it more difficult for an identity thief to open new lines of credit in your name. A credit freeze does not affect your credit score, and its free.
The three major U.S. credit bureaus Equifax, Experian, and TransUnion are a source of credit information for other companies. Mortgage lenders, credit card companies, car dealerships, and other agencies buy access to your credit history to decide if you are a good credit risk.
Lenders are unlikely to approve loans unless they know youre a good credit risk, and that requires them to review your credit reports. So, a credit freeze can help protect against, for example, an identity thief taking out a mortgage or other debt in your name.
What if youve been the victim of a data breach?
If your Social Security number has been exposed during a data breach, a credit freeze is considered a strong move to help keep anyone from opening new credit accounts in your name. Lenders and furnishers wont be able to access your credit file, and as a result would be unlikely to grant credit to anyone using your Social Security number.
Existing Creditors Can Still Access Your Credit History
Even under a credit freeze, an existing creditor can access to your credit report for certain types of account review, collection purposes, fraud control, or related activities. For example, the following entities may still access your credit report during a freeze:
- a collection agency acting on behalf of an existing creditor, and
- state or local agencies, such as law enforcement and child support agencies.
When To Use A Credit Freeze
- you know someone has stolen your identity
- you’ve been told that your personal identifying information has been compromised
- if you suspect someone has stolen your Social Security number and other information, like your date of birth, that can be used to open credit in your name, or
- you want to be especially cautious when it comes to your credit files.
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Can A Creditor See My Files If They Are Frozen
No, a creditor cannot see your files unless they are exempted from the freeze by the statute. The only thing a creditor can see is a message or a code indicating that the files have been frozen. Your report can still be released to your existing creditors, to collection agencies acting on their behalf, or to other exempt entities.
Examples of exempt entities include:
- Law enforcement agencies conducting a criminal background check, or
- A current credit-issuing entity such as a credit card company or financial institution.
What Does A Credit Freeze Do Final Words
A credit freeze is a proven tool for fighting identity theft and fraud. You can place it for free and remove it within an hour. There are both pros and cons of freezing your credit. Not only can you protect your own identity but also the identity of your loved ones.
So, whether this is the right step for you or not depends on various factors. Still, its good to know how to freeze your credit when you spot any suspicious activity on your report. After all, this single action can save you lots of headaches and unwanted debt down the road.
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How To Place A Credit Freeze
To place a credit freeze on your credit report, you may send a written request by regular, certified, or overnight mail at the addresses below. You may also place a credit freeze through each of the consumer reporting agencies websites or over the phone, using the contact information below:
Equifax Information Services LLC
In order to request a credit freeze, expect to provide some or all of the following information to the credit reporting agency, depending on whether you request the freeze online, by phone, or by mail:
You may also request a credit freeze for a minor child or a dependent, even if they do not have a credit report. Information on how to do so is available from the above credit reporting agencies.
For additional information about credit freezes, please see the FTCs website.
What Is A Security Freeze
A security freeze blocks access to your credit unless you have given your permission. This can prevent an identity thief from opening a new account or getting credit in your name. All consumers can get a free security freeze online, by phone or by mail. A security freeze, also known as a credit or a file freeze, can be lifted temporarily when you are applying for credit, or removed permanently. Parents and guardians can also shield their childrens credit report with a special Protected Consumer security freeze. These freezes can also be used to safeguard incapacitated adults.
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How Can I Lift A Credit Freeze
The same webpages used to set up credit freezes can be used to remove or suspend them. All three bureaus also provide instructions for lifting a freeze by phone, using the password or PIN connected to your freeze at each bureau.
In addition to your ability to permanently unfreeze your credit, you may have the option to lift the freeze temporarily, either by granting one-time access to a specific creditor, or by indicating a length of time you want the freeze to be suspended. Policies vary by bureau so make sure you understand what your options are before you begin the process.
When you enter your password or PIN online or by phone, your credit will be thawed within one hour. If you lose your password or PIN, the credit bureaus will need to verify your identity, which will delay the process.
Can I Freeze My Child’s Report
If your minor children have credit files, it can be a good precaution to freeze those files. Underage children ordinarily have credit files only if you’ve made them an authorized user on a credit card or as a result of identity theft.
To freeze a credit report for someone under 16, you’ll need to prove you have authority to make that request. Proof of this authority can include:
- A court order
- A lawfully executed and valid power of attorney
- A document issued by a federal, state or local government agency in the United States attesting to your parental relation to the minor
- A birth certificate
You can thaw the files when the children come of age and are ready to begin seeking credit on their own.
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Freeze Your Credit For Free
Placing a security freeze on your credit reports can block an identity thief from opening a new account or getting credit in your name. North Carolina residents can set up and manage security freezes free of charge. Credit bureaus must comply with online or telephonic requests for a security freeze within one business day of receiving them. The credit bureaus must comply with requests made by mail within 3 business days of receiving them.
A Credit Freeze Is Helpful But Not A Cure
A credit freeze can help reduce your exposure if you suspect identity theft, but it won’t eliminate it entirely.
It’s important to keep track of your credit score and check your credit reports regularly. You can get a copy of each of your credit reports every 12 months through AnnualCreditReport.com, and you can access your free Experian credit report anytime. Now through April 2021, you can receive a free credit report from each of the bureaus once a week from AnnualCreditReport.com.
As you stay on top of your credit scores and reports, you’ll be in a good position to detect potential fraud sooner, minimizing any damage to your credit history.
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How Do You Freeze Your Credit
To freeze your credit, youâll need to contact each of the three major credit bureaus: EquifaxÂ®, ExperianÂ® and TransUnionÂ®.
Each bureau has its own process, but be prepared to share some personal information, such as your Social Security number and birthdate. Youâll also have to verify yourself. That might mean providing copies of personal documents, such as a driverâs license and a bank statement.
Each bureau lets you freeze your credit online. Itâs a great option because you can also quickly unfreeze your account that way. But they also have telephone and mail options, which you might need if youâre freezing the credit of someone else.
You can visit each bureauâs website for the latest information. But here are some basics about each bureau to get you started:
How to Freeze Your Credit With Equifax
Hereâs how Equifax says you can freeze your credit:
Hereâs how Experian says you can freeze your credit:
Hereâs how TransUnion says you can freeze your credit:
- Online:Create a free account with TransUnion. Youâll be able to use the account to manage your freeze and access other services.
- Phone: Call 888-909-8872 to place a freeze over the phone. When you call, youâll have to choose a six-digit PIN.
- Mail:TransUnion says to include your name, address and SSN in your letter. It also notes youâll need to choose a six-digit PIN. Mail written requests to:
- TransUnion Woodlyn, PA 19094
Important Things to Remember About Credit Freezes
How Much Does It Cost
It used to cost anywhere from $3 to $10 per credit bureau to freeze your credit report, depending on the state in which you live. But on May 24, 2018, President Trump signed into law a bill that makes placing and lifting a freeze on your credit report free for all US citizens, no matter where you live. This law is expected to take effect sometime in September 2018.
The new law also requires credit reporting agencies to freeze, thaw or lift your credit report within one business day if you placed a request online or by phone, and within three business days if you placed a request by mail.
Does A Credit Freeze Stop Identity Theft
Setting up a credit freeze is smart and is one step to take to protect against fraud and limit the damage if you are ever a victim of identity theft. The Federal Trade Commission recommends that consumers freeze their credit to protect themselves from identity theft, which was the largest category of complaints received by the FTC in 2019. But what if a credit freeze doesnt work?
Keeping safe against identity theft is all about layers of protection. If one layer fails, youll have another in place to secure you. The more layers you have, the more secure youll be, though nothing is a guarantee. The best way to reduce the risk of identity theft is with multiple tools, such as , , dark web monitoring, proactive best-in-class identity theft protection, AND putting a credit freeze in place. The more layers of security that you have in place, the better. Some services bundle these layers of protection together in one easy-to-use package, such as IdentityForces UltraSecure+Credit.
Lifting And Unfreezing Your Credit Report
Experian makes it easy to allow a potential creditor to check your frozen credit. You can request a single-use PIN via Experians website. The creditor can use the PIN to access your credit report just one time. This is a good option if youre only applying for credit with one company.
Otherwise, if you need to lift the freeze for several different companies, for example, if youre shopping for a loan, you can use a separate form to request a temporary lift. You can provide the specific dates for the freeze to be lifted and placed back on your credit report. You can also permanently remove the credit freeze from your credit report.
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Is Freezing Your Credit A Good Idea
Placing a credit freeze as part of protecting your identity is often recommended after fraud occurs. Still, its also a good idea to freeze your credit as part of a multi-layered, proactive protection plan. Fraudsters can open credit accounts using your personal information, damaging your credit history and your credit score. If you are a victim of a data breach that included pieces of your Personally Identifiable Information such as your name, address, and Social Security number you are at risk of identity theft. PII stolen through data breaches and scams is often sold on the Dark Web and purchased by identity thieves looking to profit from your good name. If you were a victim of identity theft, you might be at a higher risk for , making you a perfect candidate for a security freeze.
How Does A Credit Freeze Work
While your security freeze in place, new creditors and lenders can’t request your credit report. Instead, when you’re ready to apply for credit, you’ll need to temporarily lift the security freeze to allow a credit pull. You may not know ahead of time which credit report the company will check, so unfreezing all three credit reports is best.
If you’re requesting to lift the freeze online or over the phone, it will become effective within an hour. If you submit your request via mail, the freeze will be lifted within three business days of the bureau receiving your request. Also, credit bureaus are required to send you confirmation of the freeze within five business days of placing the freeze.
Freezing your credit report doesn’t hurt your credit score or prevent you from accessing your free annual credit report. Your existing creditors will continue to be able to update your credit report with your latest account information.
The security freeze doesnt keep everyone out of your credit file, though. Creditors and lenders that already have access to your accounts can access your credit report and score. Employers, insurance companies, and prospective landlords can still check your credit. Law enforcement agencies can access your credit report and score despite a credit freeze, too.
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How To Freeze Your Credit And When To Do It
In 2020, the Federal Trade Commission received 2.2 million fraud reports and about $3.3 billion in losses were recorded. Its, therefore, a good idea to know how to freeze your credit, which is one of the best ways to protect yourself from fraud and identity theft. Thats why we prepared this helpful article with all the essential information about freezing your credit and when to do it.
How Long Does A Credit Report Freeze Last
This is another consideration that depends on where you live. In the vast majority of states, a freeze remains in place until you lift it. In a few states, it automatically expires after seven years.
Again, its smart to find out how your state implements credit freeze law so that you stay in control of information regarding your accounts. Even when your credit freeze is in place, its not technically a total freeze.
Who can still access your credit report while its frozen?
Your existing creditors can still access your information, as can any debt collectors they hire. Additionally, government agencies can still get the information if theyre acting on behalf of an administrative or court order, a search warrant, or a subpoena.
When you decide to apply for any type of new credit you have the ability to either permanently lift the freeze or just lift it temporarily. That gives you a window to allow your potential new creditor access to your credit report, then put the protections back in place.
Keep in mind that some entities other than creditors also check your credit reports. Employers, landlords, and even insurance companies oftentimes use your credit history as part of the application process. If theyre just using information from one credit bureau, you can save some time and money by finding out which one and only lifting the freeze from that specific bureau.
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Can I Still Use My Credit Card If I Freeze My Credit
Yes, your credit cards and bank accounts remain fully functional after you freeze your credit. You wont be able, however, to get a new credit card or open a new bank account. Both these services require a credit rating check.
What if someone has already gained access to your accounts or opened one under your name? They can also use these accounts without any issues. Thats why you should monitor your score and contact any creditor that made a hard pull without your authorization.
When Will I Need To Lift A Credit Freeze
There are a variety of occasions when you will need to lift a credit freeze.
For instance, you will need to lift the freeze if you are planning to buy a home or car, rent a car or an apartment, sign up for a cell phone plan or an account with a utility company, or apply for a credit card.
Many employers also require credit checks of potential employees.
You may submit a request to lift a credit freeze for a specific company or for a specific period of time.
How long will it take? If the request is made online or by phone, a credit bureau must lift a freeze within one hour, according to the Federal Trade Commission. If the request is made by mail, a bureau has three business days to lift a freeze upon receiving your request.Keep in mind, a credit freeze does not apply to current creditors. They can still access your credit reports. Also, government agencies may have access under certain circumstances, such as with a court or administrative order, a subpoena, or a search warrant.
Whether you decide a credit freeze is a good idea for you or not, its smart to take other steps to help protect against identity theft and fraud. For instance, its a good idea to monitor your credit reports. That way, you can see if your credit report contains any unfamiliar or suspicious activity.
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