Freeze Your Credit to Protect It from Criminals

Here’s What You Need to Know.

Criminals may sometimes work diligently to steal money, but other times, they just want to take the easy route. One way they do that is to open credit accounts in the name of an unsuspecting, easy victim. If you take steps to freeze your credit, they’ll have to move on to another victim.

They will then steal enough information about the person to open new accounts in their victim’s name, obtain as much cash as possible, or purchase as much expensive merchandise as possible before their crime is stopped or shut down.

Often, they are not caught; the victims or a bank or credit company learn of the fraud and shut down the affected accounts. In some cases, criminals have racked up as much as $100,000 in credit charges before the victims realize what is happening.

Freeze your credit to avoid a nightmare!

The effects can be devasting to an individual or a family. Recovering from such an attack might take hundreds of hours and much research, paperwork, and effort. Even worse, the victim’s credit score can plummet simply because the thieves created accounts in the victim’s name, ran up charges, and didn’t bother to pay any of the monthly bills.

And that may take months for someone to notice.

Worse than that, it makes takes

That’s why the bold step of a credit freeze has become a hot topic. Today, with credit fraud and identity theft on the rise, more financial security experts are encouraging people to freeze their credit, and many more of us are doing that.

Credit freezes are something that more and more people are choosing to do to avoid any problems.

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Freeze Your Credit! It’s Easy as 1-2-3

It Starts with Setting Up Accounts with
1) Experian, 2) Equifax, and 3) TransUnion

Chris wondered if freezing his credit would be complicated.  He was shocked when it took less than a minute. On the Experian website, a button read: “Your credit is unfrozen.”  Next to it, a button said, “Freeze your credit.”

Chris clicked that one—Done. His credit was instantly frozen with Experian. He did the same on the Equifax and TransUnion sites.

Here’s what made it so fast and easy:

• Chris had previously set up online accounts with each credit bureau when he’d requested a free credit report.
• He knew the links for each of the bureaus.

Get Started!

For you, the first step is to set up an account with each of the three credit bureaus. The fastest ways are online and by phone. The slowest way is by mail.

Freeze Your Credit with All 3 Credit Bureaus

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What happens when you freeze your credit?

When your credit is frozen, you cannot open new credit accounts (loans, credit cards, credit lines). Put another way, no one can open a new credit relationship in your name or use your credentials (Social Security number, etc.)—not you nor any criminal attempting to use your identity to do so.

Do I have to complete a security freeze with all three credit bureaus?  

It would be best to do so because it offers the most protection against fraudulent applications. If you freeze your credit with one bureau, the other two bureaus might still approve an application submitted in your name.

What are the main reasons for freezing your credit?

The primary reason would be to prevent a person or criminal organization from applying for a loan or credit account in your name or using your Social Security number. Financial professionals say that many people should seriously consider freezing their credit.

Think of it like having a safe deposit box in a bank. No one but you can open the box and only the bank can help with that. There is no other way for anyone to get to it.

Why are people reluctant to freeze their credit?

It’s not that they are reluctant; more than likely, they have never considered it or even heard of it. If they have never been advised to do it, they likely think it’s going a step too far to protect their credit.

How does someone go about freezing their credit?

You need to go to the websites of the three major credit bureaus and request that your credit be frozen with each one. 

The three are:

• Experian
• Transunion
• Equifax

Is there a way to freeze all three at the same time?

These bureaus are the organizations lenders go to get credit information about you, which they use to approve or decline any credit application you submit.

Of course, they will ask you to verify your identity and have you set up an account with them if you don’t already have one. That account will include setting up an email and password or PIN.

Is there a charge to freeze your credit?

No. It is 100% free. Other identity services, such as LifeLock and Aura, offer services but cannot freeze your credit; only monitor it.

How does freezing your credit affect your open accounts?

It does not affect your existing credit at all. Your accounts remain open and active, and all our transaction history payments and additional charges (for credit cards) will still be recorded and reported to the credit bureaus.

Are there any downsides to freezing your credit?

None, except for the minor inconvenience of having to “unfreeze” your credit if and when you needed to apply for a new loan or credit card. Here’s what else you need to know:

• It will not negatively affect your credit score or profile in any way.
• It doesn’t affect your credit usage in any way.
• It does not affect the ongoing and regular usage of your existing loans or credit cards.
• It might help prevent you from opening more credit accounts than you need.

So, what, in effect, happens with a credit freeze?

If you applied for a loan or credit card while your credit is frozen, you wouldn’t get far in the application process. In essence, your application would be declined. Why? Because, when the credit card company or lender were to enquire about your creditworthiness (with one or more of the credit bureaus), the credit inquiry would be stopped in its tracks.

Your credit freeze would tell the potential new lender, “This person is not opening new accounts at this time.”  It would not be a declined application because the credit bureaus would not have run a credit check.

Why does a credit freeze work?

A credit freeze blocks lenders from accessing your credit report. It freezes (stops cold, if you will) the act of the credit bureaus supplying information to lenders about your creditworthiness.

A credit freeze works like an “off and on” button when applying for and getting credit (if your credit is good).

• Your ability to apply for credit is always there, and if your credit score is good enough for the type of credit (simple credit card, for example)

Do I have to tell my credit card companies that I froze my credit?

You do not. To any credit card company or lender you deal with, it will look like business as usual because your relationship with your creditors doesn’t change.

Can I freeze my credit by contacting my credit card companies one at a time?

Most credit card providers allow you to freeze your card for precisely the same reasons—to help prevent credit fraud. You can often go online and freeze (or unfreeze) your credit account quickly and easily.

If I freeze my credit, will that affect or freeze my credit score?

No, it will not. However, depending on your credit history, your credit could still go up or down.

As you actively use your credit, including paying your bills and making purchases with your credit, lenders and credit companies report that history to the three credit bills.  The scoring model is active and at work, even if your credit is frozen.

So, with a credit or security freeze, can I still check my credit score? Can anyone check my credit-related information?

Yes, you and other groups can still inquire about your credit standing. A police department or government agency, people-search databases, landlords, and others can inquire about your credit status and get an answer from the credit bureaus. These are called soft inquiries, and they are legal.

How easy is it to unfreeze my credit?

It’s easy to do and takes effect quickly. You can “unfreeze” your credit (until you choose to freeze it again) or “thaw it out”—freeze it for a while as you choose. You’ll need your login information to do so.

The best or most straightforward way to unfreeze your credit is online or by phone. Either way, it should take effect immediately. If you know you will apply for a loan or credit account, you will want to unfreeze your credit in advance.

It’s an intelligent security step but not the only one you should take.

Take note! Credit fraud can still happen to you even after freezing your credit. A security freeze stops a new account from being opened in your name or using your credentials, which is a significant problem. It does not prevent a criminal from stealing your credit number and racking up fraudulent charges.

That’s why you still need to monitor your monthly credit statement activity and obtain a credit report a few times a year. That’s how you create an ongoing strategy to combat credit fraud and identity theft.

Is a credit lock the same as a credit freeze?

No, it is not. To ensure your credit is frozen, request a security (credit) freeze rather than a credit lock. You want to learn more about credit locks on the credit bureau websites.