Here’s How to Freeze Your Credit for Free (And Why You Should)
My first foray into credit freezing came in 2015, when I found out my background investigation records were stolen in a massive government hack that affected 21.5 million people.
In order to get security clearance for a government job, I had to fill out a standard form with personal information including financial records, mental health history, and international travel. This was exposed in the breach, alongside my my Social Security number, birth date, past addresses, and my mother’s maiden name, among others. Basically, the hackers had an easy-to-assemble identity theft kit.
So, yeah, suffice to say, I had to lock my credit down. I requested the credit bureaus put a freeze on my credit to make sure no one else was trying to open up accounts in my name.
Beyond a government cybersecurity breach of epic proportions, there are plenty of other smart reasons to freeze your credit. Below, experts explain what happens to it when it’s frozen and tell when you should put a freeze on your credit report.
What’s a credit freeze?
A credit freeze restricts access to your credit report, making sure that nobody—including you—can open a new line of credit in your name, says Charley Moore, founder and CEO of Rocket Lawyer, a company that provides businesses with online legal services.
How to freeze your credit
In order to freeze your credit, you do have to reach out to each credit bureau—Experian, TransUnion, and Equifax—individually, says Sean Messier, credit industry analyst with Credit Card Insider, a consumer financial and credit card comparison site. As of last year, freezing your credit is free. After the hold is placed, each bureau will give you a personal identification number, which you can use to thaw or “lift” your credit freeze when necessary, Messier explains. Thawing credit is also free.
Also, when it comes to thawing your credit, you can request a temporary lift, or remove the freeze all together if you’re applying for a loan or line of credit and need the potential lender to access your credit, says Todd Christensen, an Accredited Financial Counselor and education manager for Money Fit, a non-profit debt relief organization. According to the Federal Trade Commission, credit bureaus must lift a freeze within one hour of an online or phone request.
When should you freeze your credit?
Freezing your credit can protect you if you believe you’ve been affected by a data breach, Messier says.
“A credit freeze is generally recommended any time vital personal information, such as your social security number, has potentially been compromised,” he says. “Otherwise, you might be left vulnerable to fraud or identity theft.”
On a more conservative side, some experts say you can play it safe by keeping a freeze on your credit, and thawing it when you’re applying for credit.
Credit freezes can also protect the identity of your vulnerable family members such as your children or elderly parents or grandparents who, in most cases, are not opening new accounts.
“Identity thieves often target these two groups because the crimes can go undiscovered for years,” Moore says. “For children, identity theft could have serious consequences when it comes time for their first credit card, apartment, or job.”
Also, if you have a name that’s similar to a family member—a parent, cousin, aunt, uncle—it’s a good idea to keep a freeze on your credit to make sure your credit files don’t get mixed up, says Christensen.
If you’ve seen errors on your credit report previously that included accounts from other people with your same name, you should keep a freeze on your credit until you need to apply for loans or credit, Christensen advises.
What else you need to know about credit freezes
You will still be able to build credit while your credit is frozen, Christensen says. All current account information like balances, payments, and credit usage continues to be reported to the credit bureaus even when your credit is frozen, says. You’re also able to get your free annual credit report from each of the bureaus.
But one thing to be aware of: A credit freeze does not prevent someone stealing information or making charges to an existing account, warns financial expert Freddie Huynh, vice president of credit risk analytics with Freedom Financial Network, a debt management company.
You still need to monitor all bank, credit card, and insurance statements for fraudulent transactions, Huynh says.
In my own case, I no longer have a freeze on my credit, but I do continue to monitor my accounts and check my credit about once a month.
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