A credit freeze locks, or freezes, your credit history so no one can access it. If someone has fraudulently used your credit or your identity has been stolen, you can freeze your credit to protect yourself while you take care of the mess that was created.
A credit freeze protects you by locking your credit history, which means that lenders can not access your records. Since they can't access your credit score or other information, no new credit can be opened in your name. Lenders for credit cards, car loans, cell phones and any other line of credit will be denied until you remove the freeze.
Learning how to freeze your credit is one of the most important things you can do after you've fallen victim to identity theft or if you think your private information has been stolen or compromised.
You don't have to wait until you've been a victim to freeze your credit; you can freeze it at any time. If you will be traveling or do not plan to open a new line of credit, you can freeze your credit history to help prevent identity theft. If you can do need to apply for credit, you can temporarily unfreeze it and freeze it again.
How to Freeze Your Credit
Who to Contact
You must freeze your credit with Transunion, Equifax and Experian, which are the three agencies that creditors use. You will have to pay a fee with each agency, and this is usually under $10. The credit bureau may refer to it as a security freeze and not a credit freeze, but the two terms mean the same thing.
How to Contact Bureaus
Depending on the agency, you can call or use the Internet to freeze your credit. With either method, they will give you a PIN associated with your account.
Once the credit freeze starts, there can not be any activity on your credit report. This means that if you use your credit history to get a new insurance policy, cell phone plan or start a new utility account, they will not be able to access your credit history.
You can "thaw" your credit history temporarily by calling each credit bureau. Using your PIN, they will verify your identity and lift the freeze so your credit can be checked. This costs under $10 each time.
Things to Note
A credit freeze only prevents new lines of credit. If a thief has access to an existing account or credit card, it will not prevent him from using it. If a thief gains access to a pre-approved credit application in your name, he may also be able to submit it and use your name for credit.
It is also important to note that freezing your credit does not stop your credit accounts from being transferred to a new address. If you suspect that someone has changed your address on one or more of your accounts, you will need to place a fraud alert on your account.
Your Credit Score
A credit freeze does not affect your credit, but you should check your credit history regularly, especially if someone has used your credit fraudulently. If you notice any suspicious activity or errors, contact the credit bureau immediately.
Ultimately, it is your responsibility to keep an eye on your credit history and look for fraud. You should check your credit history several times a year, which can save you financial hardship and additional stress by preventing identity theft or stopping it before too much damage has been done.