Not a Member? Join Now

A Credit Freeze Can Protect You From Credit Fraud

With just a few pieces of your personal information, enterprising ID thieves can steal your identity and ruin your credit. The worst part? You may not realize that your identity has been stolen until your credit is ruined.

A credit freeze - also called a security freeze - can help you stop thieves from opening new lines of credit in your name.

What is a credit freeze?

A credit freeze is an instruction to the major credit bureaus that blocks access to your credit files. If creditors cannot access your credit information, they may be less likely to extend credit. This stops would-be identity thieves from opening fraudulent accounts in your name.

You can lift a freeze (referred to as a thaw) temporarily or permanently when you need to access your credit legitimately.

How to get a security credit freeze or thaw

There can be different fees for different situations. For example, a victim of identity theft may have the fee waived, while a non-victim may have to pay a small fee. Consider checking the credit bureau websites for fee structures and rules.

The Federal Trade Commission provides a credit freeze checklist, but the basic steps to place a security freeze include:

  • Contact each of the three credit bureaus (Equifax, Experian and TransUnion) individually
  • Complete state-based filing requirements
  • Pay the fees

Once your credit freeze is in place, you should receive a personal identification number (PIN) from each credit bureau. This PIN will allow you to temporarily lift (thaw) and reinstate the freeze.

It is important to note that there may be additional fees each time you thaw your security freeze.

Important facts you need to know about credit freezes

Although credit freezes can prevent new lines of credit from being opened in your name, they cannot prevent identity thieves from accessing and using your existing accounts. Be sure to continue to monitor your bank and credit card statements for fraudulent charges.

Also, each state has varying timelines for implementing credit freezes and thaws. Consider planning major purchases and other credit-related activities accordingly.

Even with a credit freeze in place, your credit information can still be accessed by:

  • You
  • Your current creditors
  • Collection agencies acting on behalf of your creditors
  • Government agencies, when necessary (e.g. collecting taxes)

Take the steps necessary to protect your credit

Try to monitor your credit activities even if you have a credit freeze in place. Early detection and safety steps can help you to discover fraudulent activity before it ruins your credit score.