Credit freeze

A credit freeze, also known as a security freeze, lets you restrict access to your credit report, which in turn makes it more difficult for identity thieves to open new accounts in your name. That’s because most creditors need to see your credit report before they approve a new account. If they can’t see your file, they may not extend the credit.

If you’re concerned about identity theft, those reported mega-data breaches, or someone gaining access to your credit report without your permission, you might consider placing a credit freeze on your report.

A credit freeze does not
A credit freeze does not completely block access to your credit report, as certain entities will continue to have access.


 * your report can be released to your existing creditors or to debt collectors acting on their behalf.
 * government agencies may have access in response to a court or administrative order, a subpoena, or a search warrant.

A credit freeze does nothing to prevent you from using existing lines of credit you may have (e.g. credit cards, loans, etc).

A credit freeze also does not:


 * affect your credit score.
 * prevent you from getting your free annual credit report.
 * keep you from opening a new account, applying for a job, renting an apartment, or buying insurance. But if you’re doing any of these, you’ll need to lift the freeze temporarily, either for a specific time or for a specific party, say, a potential landlord or employer. The cost and lead times to lift a freeze vary, so it’s best to check with the credit reporting company in advance.
 * prevent a thief from making charges to your existing accounts. You still need to monitor all bank, credit card and insurance statements for fraudulent transactions.
 * stop prescreened credit offers.

Placing a freeze on your credit report
You can place a freeze on your credit report by contacting each of the nationwide credit reporting companies listed below. Since the freeze is by Social Security number, you must make a separate request for each person, such as you and a spouse.

You'll need to supply your name, address, date of birth, Social Security number and other personal information. Fees vary based on where you live, but commonly range from $5 to $10.

After receiving your freeze request, each credit reporting company will send you a confirmation letter containing a unique PIN (personal identification number) or password. Keep the PIN (personal identification number) or password in a safe place. You will need it if you choose to lift the freeze.

Exception: If you freeze your account online, the "big three" reporting companies will give you the PIN right away. Nothing will be mailed to you.

Fees vary by state
Each state has passed security freeze legislation setting the amount which a credit bureau is allowed to charge consumers for placing, temporarily lifting, or removing a credit freeze. In addition, numerous states have “Protected Consumer” groups, who can obtain a security freeze at reduced cost, or completely free.

A comprehensive list of security freeze fees by state is provided by Equifax here (PDF).

Credit reporting companies
Below is a short list of credit reporting companies.

Before you freeze your credit
Before freezing your credit, you should create an online account with the Social Security Administration. Your identity is verified by Equifax. A credit freeze will cause the identity check to fail.

If you are interested in monitoring your credit score with Credit Karma (or some other credit monitoring service), you should do it before freezing your credit, or you will need to lift the freeze in order to register your account. You can (re)freeze your credit after the monitoring account is created.

Lifting a freeze on your credit report
In a few states, credit freezes expire after seven years. In the vast majority of states, a freeze remains in place until you ask the credit reporting company to temporarily lift it or remove it altogether. A credit reporting company must lift a freeze no later than three business days after getting your request. The cost to lift a freeze varies by state.

When temporarily lifting a freeze online, it gets done very fast; within 15 minutes or so, or maybe even instantly. This may apply to all agencies, but can be confirmed for ChexSystems and Equifax. (The 3 day delay may apply to when you make the request by mail.)

If you opt for a temporary lift because you are applying for credit or a job, and you can find out which credit reporting company the business will contact for your file, you can save some money by lifting the freeze only at that particular company.

Fraud alert
A fraud alert is not the same as a credit freeze.

A fraud alert allows creditors to get a copy of your credit report as long as they take steps to verify your identity. For example, if you provide a telephone number, the business must call you to verify whether you are the person making the credit request. In other words, additional verification of identity happens after they get the report, not before.

Fraud alerts are less effective than a credit freeze, as responsibility for verifying your identity rests with the company requesting the report; not the credit reporting agency.

Fraud alerts may not prevent the misuse of your existing accounts. You still need to monitor all bank, credit card and insurance statements for fraudulent transactions.

Three types of fraud alerts are available:


 * Initial Fraud Alert. If you're concerned about identity theft, but haven't yet become a victim, this fraud alert will protect your credit from unverified access for at least 90 days. You may want to place a fraud alert on your file if your wallet, Social Security card, or other personal, financial or account information are lost or stolen.
 * Extended Fraud Alert. For victims of identity theft, an extended fraud alert will protect your credit for seven years.
 * Active Duty Military Alert. For those in the military who want to protect their credit while deployed, this fraud alert lasts for one year.

Placing a fraud alert
You can place an initial fraud alert on your credit report online or by calling any one of the three big credit reporting agencies. The agency then must, by law, notify the other two agencies on its own. You can place the initial fraud alert whether you were a victim of identity theft or if you are just concerned about it.

It is free to place the initial alert and it stays on your report for at least 90 days. You can renew it for free after 90 days any number of times. Be sure the credit reporting companies have your current contact information so they can get in touch with you.

Credit Monitoring
Credit monitoring tracks activity on your credit reports at one, two, or all three of the major credit reporting agencies. Many companies refer to their services as identity theft protection services. What these companies offer are monitoring and recovery services. Monitoring services watch for signs that an identity thief may be using your personal information. Recovery services help you deal with the effects of identity theft after it happens.

Numerous credit cards and personal finance websites offer free credit scores, and basic monitoring services. If you’ve been a victim of a data breach, you’ve probably been offered a year of free identity-theft monitoring.

The most you can hope for is that credit monitoring services will alert you soon after an ID thief makes use of your stolen identity. That is, hopefully sooner then you might have discovered on your own by reading your free annual credit report.

Free credit monitoring
Some services only monitor your credit report at one of the credit reporting agencies. So, for example, if your service only monitors TransUnion, you won’t be alerted to items that appear on your Equifax or Experian reports.

If the credit monitoring service is free, monitoring is likely to only cover the agency you signed up with. The agency may offer monitoring of other credit reporting agencies for a fee.