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If you've been a victim of identity theft or suspect your personal information is otherwise being abused by criminals, you can block all access to your credit reports by requesting security freezes at all three national credit bureaus. Doing so can prevent unauthorized credit checks, but can also prevent processing of your own legitimate credit applications.
Before you proceed with a credit freeze, however, you should know that a better solution for many victims of identity theft may be to enact what's called a fraud alert—more on that later.
Here's what you know about how to freeze your credit, and how to decide whether or not you should.
What Is a Credit Freeze?
A credit freeze, also known as a security freeze, is a tool designed to help protect you from fraud and identity theft. It limits access to your credit report unless you lift the freeze, or "thaw" your credit. Having a freeze in place won't affect your credit scores, but it will prevent your credit report from being accessed to calculate scores unless you first lift the freeze.
Freezing your credit can help prevent identity thieves and other criminals from using stolen personal information (your Social Security number, for instance) to apply for new credit in your name. Since checking your credit report and credit scores are typically the first steps in processing any credit application, freezing your credit at the national credit bureaus (Experian, TransUnion and Equifax) can help stop unauthorized credit accounts from being opened.
The major drawback of credit freezes is that, along with preventing unauthorized credit applications, they also block authorized checks. This can complicate legitimate applications for loans, credit cards and other things because you'll need to unfreeze your reports before the process can move forward.
You must contact each national credit bureaus individually to freeze (or unfreeze) your credit reports. They'll do so for free upon request.
When Should I Freeze My Credit?
If you've been a victim of identity theft, you have more than one option to consider when it comes to protecting your credit. In many cases, a security alert may be sufficient.
When you place a security alert, also known as a fraud alert, you can add a telephone number so lenders can call you when they receive an application and verify that it's you who is applying. You also can request additional free credit reports when you add an initial security alert or victim statement. Reviewing your report can help you determine whether or not you are a victim and help you take appropriate action.
In more extreme cases in which you're experiencing ongoing fraud attempts, you may feel a security freeze is necessary.
It's worth considering taking action to protect your credit if:
- Unexplained bills or collection notices are mailed to your address, in your name or under another's name.
- New inquiries or credit accounts appear on your credit report, indicating activity with lenders or other companies you don't recognize.
- Your bank or credit union notifies you about fraudulent activity on an account.
- You receive notification that you are or could be the victim of a data breach.
Who Can Access My Frozen Credit Report?
A credit freeze prevents most credit inquiries, but certain parties can still access a frozen report under specific circumstances, such as:
- You, when you view your own credit report.
- Lenders and card issuers with whom you have accounts, who use credit checks in their account management processes.
- Landlords and rental agencies, screening you as a potential tenant.
- Phone carriers and utility companies, to set the amount of security deposit required on equipment.
- Debt collection agencies, when attempting to obtain a payment.
- Child support agencies, for purposes of determining child support.
- Credit card issuers who have prescreened you for credit offers
- Auto insurance companies, which may include credit scores in their rate-underwriting process.
- Potential employers you've authorized, conducting background checks.
- Government agents, executing court orders or warrants.
How Can I Place a Free Credit Freeze?
To order a freeze, you must provide:
- A copy of a photo ID
- Proof of address (with a copy of a recently postmarked bill, for example)
- Your Social Security number
When requesting a credit freeze online, you can provide all three items electronically. When you activate your freeze, the bureau may supply, or have you create, a personal identification number (PIN) or password to use when thawing or reactivating your freeze.
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 (one day, one week, etc.) 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 (to jumpstart their efforts at building a credit history) 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.
How Does a Credit Freeze Compare With a Fraud Alert?
While credit freezes restrict access to credit reports indefinitely, fraud alerts are temporary. An initial alert remains for one year, while an extended alert remains for seven. And while freezes must be removed before most access is granted, fraud alerts give lenders access to your credit reports and ask that they verify your identity before processing credit applications made under your name.
Compared with the process of lifting and reapplying a credit freeze at all three credit bureaus anytime you need to allow access to your report and scores, a fraud alert offers a more convenient and potentially safer alternative. A fraud alert stays in place while you continue to use your credit as normal, and won't need to be lifted like a credit freeze would.
Unlike a credit freeze, when you request a fraud alert at any one of the three credit bureaus (Experian, TransUnion or Equifax), alerts are automatically placed at all three bureaus. Removing fraud alerts before they expire will require you to contact each bureau separately.
When Should I Add a Fraud Alert?
You should learn more about fraud alerts and consider adding one if you:
- Are a victim of fraud or identity theft, or suspect you are a victim.
- Find information in your credit report that doesn't belong to you.
- Discover unexplained transactions or withdrawals from your bank account(s).
- Receive notice that your personal data was exposed in a security breach.
- Get notices you don't understand from collection agencies or the IRS.
Locking Your Credit
Another alternative to freezing your Experian credit report is to lock it. The CreditLock feature of Experian IdentityWorks℠ Premium service lets you instantly lock and unlock your credit file, so you can give lenders access anytime you're ready.
CreditLock also notifies you in real time if anyone applies for credit in your name while your credit file is locked.
You control CreditLock using a smartphone app or at Experian's website.
Does a Credit Freeze Hurt Your Credit Score?
A credit freeze has no effect on your ability to qualify for loans or credit cards, but a freeze can prevent a creditor's evaluation of your credit application. Unless you thaw your credit before you submit a loan application, the lender cannot use your credit report or credit score to gauge your qualifications as a borrower. That could delay the processing of your application.
Freezing, locking or applying for fraud alerts on your credit reports are all options for protecting your credit history after confirmed or suspected identity theft or fraud.
If a credit freeze is something you'd like to apply to your credit reports and scores, learn how to request one at the Experian's Security Freeze Center.