Freezing your credit report is sometimes very necessary. It prevents credit thieves from opening new cards and other accounts in your name, and is often recommended when you’re dealing with the ramifications of identity theft.
What Is a Credit Freeze?
A credit freeze, also known as a security freeze, gives you the chance to “lock” your data at major credit bureaus. Doing this also makes it impossible for identity thieves to use your name on anything linked to your credit report. You will receive a password or personal identification number to use for temporarily lifting or removing the freeze altogether.
Credit freezes do not affect your credit score or prevent you from receiving your annual credit report. You’ll have to lift the freeze to apply for a job, rent an apartment, open new accounts, or buy insurance. Additionally, a credit freeze will not stop an identity thief from using your existing accounts, so you’ll still need to monitor credit card, bank, and insurance statements for fraudulent charges.
How to Freeze Your Credit Report
Freezing your credit report requires a request to each credit bureau. There isn’t much variation in what’s required to freeze your report between the different credit bureaus, and Equifax, Transunion, and Experian all offer information on how to go about the process. Requests must be made in writing and include your name, contact information and proof of address, date of birth, social security number, a copy of your driver’s license or other valid ID, and payment via credit card or check. Payment varies by state, but is generally between $3 and $10.
It’s also necessary to provide proof of theft, such as an identity theft report, police report, or DMV report. Send copies of your proofs to the credit bureaus since they probably will not be returned to you.
Credit bureau addresses are as follows:
Experian Security Freeze
P.O. Box 9554
Allen, TX 75013
TransUnion LLC
P.O. Box 2000
Chester, PA 19022-2000
Equifax Security Freeze
P.O. Box 105788
Atlanta, Georgia 30348
When to Freeze Your Credit Report
Freezing your credit report is essential when an account has been opened in your name. It’s also vital if you’ve learned your Social Security Number was taken following a data breach.
Consumer advocates, security experts, and even state attorney generals sometimes recommend freezing your credit report even if the above issues do not occur. This is because data breaches have become commonplace. According to the nonprofit organization, Identity Theft Resource Center, by the end of 2015, 766 data breaches had occurred at banks, big companies, and government agencies. This resulted in the exposure of more than 178 million records.
Credit Freeze Vs. Fraud Alert
A credit freeze differs from a fraud alert in that the former “locks down” your credit while the latter allows creditors to obtain a copy of your report as long as they verify your identity. As with credit freezes, fraud alerts do not stop identity thieves from using existing accounts, but do prevent them from opening new ones. Initial fraud alerts protect your information for 90 days, and are often used by those who are concerned about identity theft but haven’t been victimized yet. Extended fraud alerts protect the credit of identity theft victims for seven years.
Lifting Your Credit Freeze
Lifting your credit freeze, whether temporarily or permanently, requires contacting credit agencies, who typically lift the freeze within three business days following your request. The cost to lift the freeze again varies by state.
Protect yourself from possible and actual identity theft with a credit freeze. Removing fraudulent activity from your credit report often takes hours, and such activity affects your credit score until it’s removed.
"It's much better to shut the door before it even takes place," notes Mike Litt, a consumer program advocate at the nonprofit U.S. Public Interest Research Group. "You can save yourself so much time and headache."