Credit Freeze
A “credit freeze” allows consumers to put a block on their credit file to prevent identity theft. It’s intended to prevent criminals and fraudsters from opening new lines of credit if vital information has been compromised.
With a credit freeze in place, new creditors, employers, and landlords will not have access to your credit report. If they make a request to view your credit report, they will simply receive a message or a code that indicates that the account has been frozen. Without access to a credit report, most creditors will not extend any new credit, thereby protecting consumers from further identity theft.
Sometimes canceling a credit card or closing a checking account simply isn’t enough to prevent fraud, as total identity theft may have occurred, causing countless problems for a consumer. A credit freeze is a good way to ensure that no new lines of credit are opened in your name.
A credit freeze is free to consumers who have a police report that can be documented to show recent abuse to their credit profile. If you simply want to freeze your credit profile without documentation, a small fee is charged. The fee varies based on the state you live in.
In California, a credit freeze costs $10 if you aren’t a victim of credit fraud, or if you fail to provide documentation. That $10 fee is per credit bureau, so the true cost is $30, as blocking one or two credit bureaus would do little to protect your identity, if the third allowed creditors to view your credit report.
“For a security freeze to be effective to stop new account identity theft, it must be placed at each of the three major credit reporting agencies,” Gail Hillebrand, a senior attorney at Consumers Union, said in a statement. “Otherwise, it would be like locking the front door to your house, while leaving your window and back door open.”
To execute a credit freeze, you can write to the individual credit bureaus at the addresses listed below. Be sure to send the letter by certified mail, and contact the individual creditor first to find out what information they need from you to execute such a freeze, including payment details.
Equifax Security Freeze
P.O. Box 105788
Atlanta, GA 30348
Experian Security Freeze
P. O. Box 9554
Allen, TX 75013
TransUnion Security Freeze
P. O. Box 6790
Fullerton, CA 92834-6790
If you’re married, you and your spouse will need to send separate letters and payments to place a freeze on both accounts.
Unfortunately, a credit freeze for all three bureaus isn’t available in every state, though it should be in the near future thanks to consumer rights groups. Check with your local state government or call the credit bureaus to see what’s offered in your state.
When the credit bureau receives your letter, they have five business days to place the freeze on your account. Once your credit file is frozen, you’ll receive a PIN number from the creditors which you’ll need to keep handy to lift a freeze in the future. You‘ll have the option of lifting a freeze temporarily or permanently, on one account or all accounts, and associated fees will vary.If you choose to lift a credit freeze, you can do so by phone, using your PIN number. The credit bureaus have three business days after receiving your phone request to lift the freeze.
New creditors will not be able to view your credit score or credit report, and a credit freeze will not lower your credit score. If you wish, you can order a copy of your own credit report even if your account has been frozen.
Keep in mind that existing creditors, collection agencies working on their behalf, and government agencies can still access your credit report. And you may still receive offers for new credit if you haven’t previously opted out. (You can stop pre-approved credit offers by calling 888-5OPTOUT).
A credit freeze is a good way to ensure further identity theft doesn’t take place, as a simply fraud alert may not be enough to fully protect your credit profile. If you’ve been the victim of identity theft recently, you should seriously consider a credit freeze until things blow over. It can also prevent damage to your credit score. Just remember that it may be frustrating if you need to open a new line of credit, such as a new cell phone plan, insurance policy, credit card, auto lease, or a mortgage.