Potential downsides of placing a credit freeze?

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investor4life
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Potential downsides of placing a credit freeze?

Post by investor4life » Tue Sep 12, 2017 9:24 pm

For those of you who have had a credit freeze in place for some time, say, a year or two (not over the past few days in response to the Equifax fiasco):

Have you experienced any unexpected problems, like being denied a service? Something that caused a delay due to having to lift the freeze. I am not talking about run-of-the-mill stuff like applying for a credit card. More like a new employer being unable to run a background check, or problems at a port of entry to the US, or changing cell phone carriers. for instance.

I was about to place a freeze at Experian, when the following caught my eye and gave me some pause:

"A security freeze is designed to prevent credit, loans, and services from being approved in your name without your consent; however, using a security freeze may delay, interfere with, or prohibit the timely approval of any subsequent requests or applications regarding a new loan, credit, mortgage, insurance, government services or payments, rental housing, employment, investment, license, cellular phone, utilities, digital signature, Internet credit card transaction, or other services, including an extension of credit at point of sale."

Coachrhino11
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Re: Potential downsides of placing a credit freeze?

Post by Coachrhino11 » Tue Sep 12, 2017 9:36 pm

investor4life wrote:
Tue Sep 12, 2017 9:24 pm
For those of you who have had a credit freeze in place for some time, say, a year or two (not over the past few days in response to the Equifax fiasco):

Have you experienced any unexpected problems, like being denied a service? Something that caused a delay due to having to lift the freeze. I am not talking about run-of-the-mill stuff like applying for a credit card. More like a new employer being unable to run a background check, or problems at a port of entry to the US, or changing cell phone carriers. for instance.

I was about to place a freeze at Experian, when the following caught my eye and gave me some pause:

"A security freeze is designed to prevent credit, loans, and services from being approved in your name without your consent; however, using a security freeze may delay, interfere with, or prohibit the timely approval of any subsequent requests or applications regarding a new loan, credit, mortgage, insurance, government services or payments, rental housing, employment, investment, license, cellular phone, utilities, digital signature, Internet credit card transaction, or other services, including an extension of credit at point of sale."
+1....wondering exact same before I freeze.

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Watty
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Re: Potential downsides of placing a credit freeze?

Post by Watty » Tue Sep 12, 2017 9:44 pm

I have probably had ours frozen for ten years with no regrets.

Unfreezing them only costs a few bucks in my state. I will occasionally switch utilities to get promotions and get new credit cards to get the signup bonus so that is just a small hoop to jump through so it is not a big deal.

The only real problem I have heard about is that it takes a lot of paperwork and some time to replace a PIN if you lose your PIN, and that makes sense. So don't lose it :)

Apparently Social Security uses one of the credit bureaus to verify your identity for online signup so you might have to go into the Social Security office when you are ready to start Social Security.
Last edited by Watty on Tue Sep 12, 2017 9:45 pm, edited 1 time in total.

JSDNJ
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Re: Potential downsides of placing a credit freeze?

Post by JSDNJ » Tue Sep 12, 2017 9:44 pm

Same here. So far I've just enrolled in whatever BS equifax offered.

JSDNJ
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Re: Potential downsides of placing a credit freeze?

Post by JSDNJ » Tue Sep 12, 2017 9:45 pm

Watty wrote:
Tue Sep 12, 2017 9:44 pm
I have probably had ours frozen for ten years with no regrets.

Unfreezing them only costs a few bucks in my state. I will occasionally switch utilities to get promotions and get new credit cards to get the signup bonus so that is just a small hoop to jump through so it is not a big deal.

The only real problem I have heard about is that it takes a lot of paperwork and some time to replace a PIN if you lose your PIN, and that makes sense. So don't lose it :)

Apparently Social Security uses on of the credit bureaus to verify your identity for online signup so you might have to go into the Social Security office when you are ready to start Social Security.
How does the approval process differ when it's frozen? Seems like everyone should just freeze always if it's not that much of a pain.

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kenyan
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Re: Potential downsides of placing a credit freeze?

Post by kenyan » Tue Sep 12, 2017 9:48 pm

I've had ours frozen for a couple of years. The first 1.5 years, we didn't need our credit. I did need to thaw it a couple of times while refinancing my mortgage recently, which was a little annoying (all three bureaus when applying, then just one bureau right before closing). It's 10 bucks per bureau where I live.

Worth the peace of mind, as long as you're not a credit card rewards churner or have some other reason to need your credit frequently.
Retirement investing is a marathon.

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TimeRunner
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Re: Potential downsides of placing a credit freeze?

Post by TimeRunner » Tue Sep 12, 2017 9:55 pm

kenyan wrote:
Tue Sep 12, 2017 9:48 pm
I've had ours frozen for a couple of years. The first 1.5 years, we didn't need our credit. I did need to thaw it a couple of times while refinancing my mortgage recently, which was a little annoying (all three bureaus when applying, then just one bureau right before closing). It's 10 bucks per bureau where I live.

Worth the peace of mind, as long as you're not a credit card rewards churner or have some other reason to need your credit frequently.
We had almost an identical experience. Had to thaw before initial mortgage refi paperwork, and then, suddenly just before closing, there was a last-minute demand to thaw one of the freezes because the lender was required to make a last-minute check just before funding to meet requirements to bundle/resell the mortgage after close (which lenders tend to do). There was a bit of a scramble, but it went through just fine. I expect lenders will adjust their processes now that many folk are doing the credit freeze thing....
One cannot enlighten the unconscious. | Endurance athletes are the Bogleheads of sports. | "I like people - I just don't want to be around 'em." - Russell Gordy

NorCalDad
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Re: Potential downsides of placing a credit freeze?

Post by NorCalDad » Tue Sep 12, 2017 9:57 pm

When you thaw, do you have to thaw all 3 or 4? Or do lenders actually tell you which of the agencies they use to verify your credit?

Kompass
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Re: Potential downsides of placing a credit freeze?

Post by Kompass » Tue Sep 12, 2017 10:02 pm

I was wondering if the ChexSystem freeze interferes with the ability to buy CDs?
The large print giveth and the fine print taketh away.

billthecat
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Re: Potential downsides of placing a credit freeze?

Post by billthecat » Tue Sep 12, 2017 10:02 pm

JSDNJ wrote:
Tue Sep 12, 2017 9:44 pm
Same here. So far I've just enrolled in whatever BS equifax offered.
Me too, though I recognize that freezing only one probably does no good.

This is insane. I can't believe 140M Americans have to go through this.

My brother, who has never had a dime, did better than me in the 2000 stock crash, 2008 real estte crash, 2011 commodities crash, and now this. I'm starting to wonder if he chose the better path.

nalor511
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Re: Potential downsides of placing a credit freeze?

Post by nalor511 » Tue Sep 12, 2017 10:03 pm

I've been frozen since an ID theft incident in 2013, I've unfrozen for a single pull via one time pin anytime I've needed to open a new CC or bank account, probably 8 times in 4 years. Each time it's taken 5 min. Never paid a cent to freeze or unfreeze (single pull). CA

kaneohe
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Re: Potential downsides of placing a credit freeze?

Post by kaneohe » Tue Sep 12, 2017 10:12 pm

nalor511 wrote:
Tue Sep 12, 2017 10:03 pm
.................................. Never paid a cent to freeze or unfreeze (single pull). CA
How possible? Old fogey like me? :D Still I thought freeze is free for > 65 but I thought unfreezing cost $5? Which bureau did you
unfreeze?

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Watty
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Re: Potential downsides of placing a credit freeze?

Post by Watty » Tue Sep 12, 2017 10:14 pm

JSDNJ wrote:
Tue Sep 12, 2017 9:45 pm
Watty wrote:
Tue Sep 12, 2017 9:44 pm
I have probably had ours frozen for ten years with no regrets.

Unfreezing them only costs a few bucks in my state. I will occasionally switch utilities to get promotions and get new credit cards to get the signup bonus so that is just a small hoop to jump through so it is not a big deal.

The only real problem I have heard about is that it takes a lot of paperwork and some time to replace a PIN if you lose your PIN, and that makes sense. So don't lose it :)

Apparently Social Security uses on of the credit bureaus to verify your identity for online signup so you might have to go into the Social Security office when you are ready to start Social Security.
How does the approval process differ when it's frozen? Seems like everyone should just freeze always if it's not that much of a pain.
I ask which credit bureau they use when I apply for something. Sometimes they will tell you so I can unfreeze it then call them back a few minutes later when I have unfrozen it. Sometimes they don't know or won't say which credit bureau they use so I will get a letter a few days later saying which bureau needs to be unfrozen and phone number to call when it is unfrozen.

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TimeRunner
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Re: Potential downsides of placing a credit freeze?

Post by TimeRunner » Tue Sep 12, 2017 10:18 pm

NorCalDad wrote:
Tue Sep 12, 2017 9:57 pm
When you thaw, do you have to thaw all 3 or 4? Or do lenders actually tell you which of the agencies they use to verify your credit?
At that time, 2016, we had a freeze on the Big 3, and had to thaw all three for both of us. ($60 here.) Then the later single thaw - they told us which one to thaw. ($20.) We made back all thaw costs the first month of the re-fi so no big deal. The peace of mind is worth it, and the freeze was obviously effective as our mortgage broker was in a tizzy. :wink:
One cannot enlighten the unconscious. | Endurance athletes are the Bogleheads of sports. | "I like people - I just don't want to be around 'em." - Russell Gordy

AlwaysBeClimbing
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Re: Potential downsides of placing a credit freeze?

Post by AlwaysBeClimbing » Tue Sep 12, 2017 11:38 pm

This is why I signed up for TransUnion True Identity service(free),which let's me toggle freezing for TU whenever needed. I froze the other four agencies.

bogglizer
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Re: Potential downsides of placing a credit freeze?

Post by bogglizer » Tue Sep 12, 2017 11:43 pm

We froze our credit back in around 2003 for around five years or so. I lost some of the paperwork, and it was a PITA to unfreeze when we decided to move. I bet the entire process is different now.

Salmon Maki
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Re: Potential downsides of placing a credit freeze?

Post by Salmon Maki » Wed Sep 13, 2017 12:22 am

I didn't d have an issue opening a new utility account, and I assume it was due to my credit freeze. They required me to bring ID in person to open an account.

anoop
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Re: Potential downsides of placing a credit freeze?

Post by anoop » Wed Sep 13, 2017 12:51 am

Does a credit file freeze actually work if the malicious entity has all of your personal information?

You get a PIN to unfreeze the credit file, but what happens if someone calls in and says they've forgotten the PIN?

[I see it takes paperwork to get that done so may be harder.]

The stolen information can be used to get into bank accounts.

MikeG62
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Re: Potential downsides of placing a credit freeze?

Post by MikeG62 » Wed Sep 13, 2017 7:01 am

My credit reports have been frozen for about a year now. Had to unfreeze them three times this summer (once for a new car lease and twice for new credit cards - one for each of my wife and I). Freezing in my state was free. Unfreezing cost $5 and was done completely online (as were the initial freezes). It really has not been a hassle. Just need to ask the bank rep which CR agency they use so you unfreeze the right one (and only one). Also, you can unfreeze for any length of time you want. I think I did 5 business days each time.

Rupert
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Re: Potential downsides of placing a credit freeze?

Post by Rupert » Wed Sep 13, 2017 7:09 am

Mine has been frozen for years, and I have not experienced any problems. Granted, I don't churn credit cards and haven't moved. The few instances I've needed to temporarily unfreeze I was able to do so online with ease without calling anyone. Your prospective creditor will tell you which one to unfreeze and you can with at least one of the credit bureaus (Experian, I think; not sure about the others) obtain a one-time-use PIN which you can then give to the creditor to use in checking your credit just once. The really important thing is not to lose your PINs. I keep one copy in a secure place at home and another copy in my bank safe deposit box. Most of the people who report experiencing problems seem to have lost their PINs. Note that I'm a victim of identity theft (not merely theft of identifying information); so it doesn't cost me anything to freeze/unfreeze.

giantyankz
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Re: Potential downsides of placing a credit freeze?

Post by giantyankz » Wed Sep 13, 2017 8:33 am

We have also had our credit frozen for several years without any real issues. Fortunately NC law allows one to freeze and unfreeze credit without any charge as long as you complete the process online. The only time I had even a slight problem was when we recently changed cable subscribers and they apparently needed to pull a credit report so we were unable to complete the transaction online. Once we called to find out why we were being denied and they explained they needed a credit pull, I was able to unfreeze the credit while my husband was still on the phone with the cable company and everything went through fine.

miles monroe
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Re: Potential downsides of placing a credit freeze?

Post by miles monroe » Wed Sep 13, 2017 8:59 am

Watty wrote:
Tue Sep 12, 2017 9:44 pm

The only real problem I have heard about is that it takes a lot of paperwork and some time to replace a PIN if you lose your PIN, and that makes sense. So don't lose it :)

Apparently Social Security uses one of the credit bureaus to verify your identity for online signup so you might have to go into the Social Security office when you are ready to start Social Security.
they do use one of the credit bureaus -- don't remember which one -- but i called customer service and they were able to tell which one it was. first and only time i've thawed my credit and the process worked flawlessly.

clark howard also warns about losing your pin. i keep a copies in my safe deposit box.

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CardinalRule
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Re: Potential downsides of placing a credit freeze?

Post by CardinalRule » Wed Sep 13, 2017 9:22 am

One thing that I hadn't appreciated until recently - the interaction between credit freezes and credit monitoring services.

The value of paid services is debatable and a different subject altogether, but if you are going to subscribe to one of these (or get one for free because of a breach), you apparently need to do so before placing your freezes.

From the FTC website: https://www.consumer.ftc.gov/articles/0 ... n-services
If you want to both freeze your credit and get monitoring services, sign up for the monitoring service before placing the credit freeze. That way, the monitoring service can get access to your credit files. Otherwise, you may not be able to complete the service’s account creation process. If you lift the freeze to give the service access, restore it as soon as possible.
And of course, in most states, you would generally be charged to temporarily unfreeze your file. :oops:

anoop
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Re: Potential downsides of placing a credit freeze?

Post by anoop » Wed Sep 13, 2017 10:12 am

People are worried about credit freezes, but the real concern should be accounts being taken over.

http://www.itnews.com/article/3223232/d ... overs.html
What’s more likely is that stolen information will be used to take over existing accounts, such as banking, brokerage, phone service, and retirement accounts.

pindevil
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Re: Potential downsides of placing a credit freeze?

Post by pindevil » Wed Sep 13, 2017 10:28 am

I've had our credit frozen for about 2 years now. No issues really other than their web sites don't always work correctly and you have to call in for a temporary thaw.
I cannot believe the default is having credit history so easily accesible. Consumers credit history should be frozen by default and only unfreeze when needed.

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