If you’ve never done a credit freeze, it can be hard to know where to start. In today’s guide, however, we’ll show you how to freeze your credit, explain just what a credit freeze is, cover the pros and cons of doing so, plus touch on some other factors to consider before you begin.
Freezing your credit is one of the most — if not the most — concrete and effective ways you can protect your credit history. By doing so, you can stop criminals from being able to open new, fraudulent accounts in your name. When you freeze your credit, you put a “lock” on your credit report that only you (and a few pre-existing entities) can access, which means criminals are stopped cold as soon as they try applying for new credit.
Data breaches are common news nowadays, so it’s smart to want to protect yourself and freezing your credit is the best way to do that. Few other methods can claim the same — so dive in and learn how to freeze your credit.
What’s a credit freeze?
You know it’s important to protect your identity, especially in modern times. But before we dive into how to do so by freezing your credit, it’s important to understand what exactly a credit freeze is, anyway — so here’s the basics. A credit freeze, also known as a “security” freeze, stops potential lenders — and criminals — from accessing your credit report by locking it down. Normally, when you apply for a new credit account, the lender or creditor has to request your credit report to determine your history and eligibility, but when you apply a credit freeze, this check is no longer possible.
So anybody who tries to open a new account in your name is stopped because the potential lender can’t pull your report — even if the would-be thief has your personal information. And the only way around this is to lift the freeze, or “unthaw” it, using a unique PIN that you receive when you enact the freeze. No PIN means the account stays frozen, which means no access for new lenders. So if you leave your report frozen, this stops any new accounts from being opened by anyone other than yourself.
That said, there are some exceptions to who can access your credit report once it’s been frozen. Pre-existing creditors and lenders can still access your credit report and score without needing you to unlock it; some law enforcement agencies and government entities can also do so if they find it necessary.
Pros and cons of freezing your credit
As with anything there are good things and bad about freezing your credit. Here they are in pros vs. cons format:
- Potential new lenders can’t access your report, so it helps reduce your risk of identity theft.
- Credit freezes are free to place and lift (“thaw”) as of September 21st, 2018, under the Economic Growth, Regulatory Relief, and Consumer Protection Act.
- You can lift the freeze permanently or temporarily at any time.
- You can freeze your child’s credit for free under the same law
- If you want to apply for credit in any form — card, mortgage, car loan, etc. — you’ll need to contact the bureaus(s) where you’ve placed the freeze to have it lifted.
- It can delay the process for job applications, cell phone service, etc. — anything that requires a credit check — because you need to lift the freeze each time. This can be a delay of a few days while waiting for your credit to thaw.
- If a criminal has already accessed your accounts, a credit freeze won’t protect you — it only protects against new accounts.
Credit freeze vs. fraud alert
You may have heard of another type of credit protection called a “fraud alert.” What’s the difference between that and a credit freeze? It’s simple: a credit freeze locks down your credit report from being accessed and needs to be unthawed for anyone to access your credit report. A fraud alert , or “initial security alert”, still allows potential lenders and creditors to access your report, but applies a note to it. When a lender checks it, they’re notified that you may be a victim of identity theft and that they should take extra steps to verify your identity before granting credit.
For example, if you provide a phone number or email address, they’ll call or email you to validate that it’s really you. There are 3 types, and applying a fraud alert to just 1 credit bureau automatically applies it to the other 2:
- Fraud alert
This basic type was extended by the same law mentioned earlier from being on your file for 90 days to 12 months.
- Extended fraud alert
The extended fraud alert can be applied if you provide a police report or other valid identity theft report. It extends the time of the alert on your file to 7 years.
- Active duty military alert
If you’re in the military and are deployed, you can apply this type of fraud alert. It initially lasts for 1 year, but can then be extended to the length of your deployment. It also removes from the marketing lists that prescreen credit card offers for 2 years.
How to freeze your credit
Step 1 — Collect your personal info
Before you contact any bureaus (that’s next), make sure you have all your documents lined up. You’ll need to provide each bureau that you’re going to freeze your report at with your name, address, birth date, and SSN.
Step 2 — Contact the bureaus
Next, you’ll need to contact each of the 3 major credit bureaus individually: Equifax, Experian, and TransUnion. Once you’re on the phone (or website), you’ll be asked some questions to verify your identity, then receive a PIN for freezing and unfreezing your report. Rinse and repeat for each bureau, and you’ve successfully applied a credit freeze to your reports.
Each credit agency makes it simple to do and allow you to freeze your credit online or by phone:
- Equifax: website, or by phone line (automated): 1-800-685-1111 (1-800-349-9960 if New York resident).
- Experian: website, or by phone line: 1-888-EXPERIAN (1-888-397-3742).
- TransUnion: website, or by phone line (automated): 1-888-909-8872.
Step 3 — Thawing your credit freeze
If at any point you need to lift your credit freeze, all you need to do is contact the bureau where you want it lifted. If you request to have the freeze thawed by phone or online, it must be lifted within 1 hour. If you send your request by mail, it has to be lifted no later than 3 business days after the bureau has received your request. If you only need a temporary lift, as in the case of a job or credit application, ask what bureau will be checked. Then you can save some time and request a lift only at that specific bureau. If you’re unable to find out that info, you’ll have to request a lift from each of the 3 major agencies.
When should you get a credit freeze?
Now that you know what a credit freeze is, the pros and cons of them, and how to apply a freeze to 1 or all of your credit reports, a question remains: when should you freeze your credit? The most obvious, and primary reason, is if you are or have been a victim of identity theft. But there are a few other cases where you may want to consider it:
- You have been receiving bills or collection notices under your name or another name listed at your address;
- You know your credit card number has been stolen;
- Your mail looks tampered with or has been stolen;
- You’re receiving new inquiries on your credit report from businesses that you didn’t give permission to;
- Your bank notifies you of a fraud incident with one of your accounts;
- There are unexplained transactions or withdrawals from your bank account(s);
- You’ve fallen or suspect you may have fallen for an IRS tax return scam in the past;
- You’ve received a notification that you are or could be a victim in a data breach.
If any or all of these things happen, it’s a good indicator that you may be at risk of identity theft. In that case, it’s a good plan to get a credit freeze to protect yourself.
What about a fraud alert?
But what about a fraud alert? If you’re just concerned, but not sure that you’re a victim, do you need to go all the way to a credit freeze? When should you opt for a fraud alert instead? The reasons to get a fraud alert are essentially the same as listed for a credit freeze. Taking that into account, the main question to remember when deciding between the two is, do you want to still be able to access your credit reports?
If you are planning on applying for credit — especially large loans, like a home mortgage or car — in the near future, a fraud alert may be the better option. Since a fraud alert still allows businesses to pull your credit report, there is 1 less step for you take to allow that to happen. But, you still get protection in that the potential lenders/creditors checking your report must contact you in some fashion to validate your identity before providing or extending credit.
Another thing to keep in mind is that fraud alerts last just 1 year. If you discover that you are a victim of identity theft and are able to provide a police or other identity theft report, you can apply for an extended fraud alert; but if not, the fraud alert will be removed after 12 months.
Credit freeze tips & FAQs
A freeze doesn’t make you invincible
An important thing to note is that as good as a credit freeze is at protecting your identity, it’s not completely foolproof. It will not make you invincible. If a thief steals your credit card — whether out of your wallet or in a data breach — the freeze won’t help. Any existing credit accounts can still be used and a freeze will not prevent the loss of money in those cases.
Expect credit to take longer
Because you need to unthaw your report each time you want to apply for a loan, credit card, or even a job, it can cause delays. Most companies won’t give you credit until they have checked at least 1 of your 3 credit files, and although your report is supposed to be unthawed within 1 hour of your request (online or by phone), it still takes extra time for the credit check to go through. If you’re going to need credit quickly in any cases like those above, a fraud alert may better suit your needs.
Even though you’re credit is frozen, that doesn’t let you off the hook from regular security measures. Check your bank, loan, and credit card statements regularly for discrepancies. If you may have been exposed in a data breach, update all passwords and follow any other security-related steps that the breached company relays to you in their notification.
Does a credit freeze affect your credit score?
No, it does not. A credit freeze also does not stop you from getting your free annual report that’s guaranteed to you by federal law from each of the 3 major credit reporting agencies.
Does a credit freeze stop prescreened credit card offers?
No, a credit freeze does not stop you from being sent prescreened credit offers. If you’d like to stop receiving those, call 888-5OPTOUT (888-567-8688) or visit optoutprescreen.com.You’ll have the option to opt out of these offers for 5 years or permanently. But keep in mind this may not stop all offers, as some companies send credit offers that are not based on prescreenings.
Can anyone still see your frozen credit report?
Although a credit freeze stops unauthorized individuals from applying for new credit accounts in your name, there is a relatively extensive list of people and reasons your report can still be pulled, even when frozen and without being unthawed:
- If you want to view your own report (free annual report)
- Creditors who you have a relationship with prior to the credit freeze
- Background screens by landlords or rental agencies
- Phone and utility companies
- Debt collection agencies wanting payment
- Child support agencies determining child support
- Underwriting insurance for yourself
- Prescreening credit offers
- Employment/potential employers who you grant permission to
- Government agencies acting in response to a court or administrative order, subpoena, or search warrant
Freezing your credit isn’t a complicated process — just a slightly tedious one. But now, you have the knowledge and tools at your fingertips to be able to freeze it at any time. So now we toss the ball back to you: what will you do with the information you now have? Will you freeze your credit, or forgo it in favor of a fraud alert?
Was this information helpful? What things are making you concerned about your credit reports? Share your thoughts and experiences in the comments below.