Freezing Your Credit

The “WHAT”: 

For those who want to take extra precautions in regards to their consumer credit reports, one potential action can be to “freeze” your credit. This is free to do. Upon doing so, no additional credit can be obtained on your identity while it’s frozen. Therefore, if at some point you did want to obtain a new credit line or some kind of loan, you would simply have to “unfreeze” your credit. You can essentially turn this safeguard on and off as you need just by following the necessary steps through each of the (3) credit bureaus.

Pros:

– Reduces risk of identity theft
– This is free to do, whereas credit monitoring services can be an expense
– The freeze can be lifted temporarily if you need to apply for credit
– You do NOT have to freeze your credit at all (3) credit bureaus if, for example, you are applying for credit and the lender is only going to inquire on your credit through one (or two) of the credit bureaus (as opposed to all three).

Cons:

– You will have to contact each credit bureau where you’ve frozen your credit to lift the freeze
– It can delay applications for jobs, cellphone service, or any other situation that requires a credit check, since you have to lift the freeze each time and it can take a few days for your credit freeze to thaw

The “HOW”: 

To freeze your credit, which is different from locking your credit, you’ll need to contact each of the (3) credit agencies—Equifax, Experian, and Transunion—and request a credit freeze.

When you make the request, you’ll need to provide your name, address, birth date, and social security number. You’ll be further verified and receive a PIN number that you can use to unfreeze and refreeze your credit report(s) as needed.

You can request that your credit be frozen through each of the credit bureaus online through their respective websites. If you are not comfortable doing so, you can call each of the credit bureaus as well. Their phone numbers are as follows: Experian- 1-888-397-3742; Equifax- 1-888-298-0045; Transunion- 1-888-909-8872.

Bottom Line

Freezing your credit is an effective, cost-free way to make it harder for thieves to open up credit cards or other financial accounts in your name. It also can reduce your chances of becoming an identity theft victim. So if you are at a point in your life where you don’t believe your credit reports need to be readily accessible for things like credit applications and/or other related events, this may be a convenient and cost-effective way to further protect yourself from identity theft.