Your credit report contains valuable information that lenders review during the loan application process. However, this report isn’t only useful for getting extra capital. Consumers can regularly check their credit reports to ensure there isn’t anything suspicious. If someone is using your identity to take out loans and lines of credit, you’ll see that activity on your credit report.
Freezing your credit report can stop perpetrators in their tracks, and it’s not too difficult to freeze your account. This guide will explore how to freeze your credit report and a few things to know before pursuing this path.
What is a Credit Freeze and How Does It Work?
A credit freeze prevents creditors from accessing your account. While creditors aren’t the fraudsters in these types of cases, most of them run credit checks before giving anyone money. If someone tries to use your information illegally to obtain a loan or a line of credit, the application will get rejected since the lender can’t access your credit report.
However, a credit freeze will also prevent you from taking out loans and lines of credit. It’s a necessary tradeoff for many consumers who find themselves as victims of identity theft.
Why Consider Freezing Your Credit?
People initiate credit freezes to protect themselves from fraudsters who have obtained their personal information. Some people freeze their credit reports to make it harder to access loans and force positive financial change. A few consumers may also freeze their credit reports if they do not anticipate applying for new loans or credit lines for several years. It’s possible to unfreeze your credit report when you are ready to borrow money again.
Common Misconceptions About Credit Freezes
Some people only use a credit freeze as a last resort. Since it’s not used that often, some consumers may have misconceptions about the consequences and how they work.
Here are some of the truths about credit freezes that you should know:
- A credit freeze will not impact your credit score.
- Security freezes do not cost any money.
- You must place a security freeze for each of the three major credit bureaus.
- You can place a credit freeze on behalf of someone else with sufficient documentation.
- It’s possible to lift a security freeze temporarily.
- It doesn’t protect you from all types of fraud. If someone has your credit card information, a credit report freeze will not help. In that scenario, you must freeze your credit card.
Does Freezing Your Credit Affect Your Credit Score?
Freezing your credit does not impact your FICO score. You will still have to make on-time payments and manage your debt so you have a low credit utilization ratio. A credit freeze does not affect your current credit accounts, which continue to impact your credit score.
Understanding the Impact of a Credit Freeze
A credit freeze does not affect your existing accounts. However, it prevents you from incurring new credit accounts. That means no more hard credit checks, and it can also protect you from fraud.
Pros and Cons of Freezing Your Credit
These are some of the advantages and disadvantages to consider before you freeze your credit report.
Pros
- Prevent thieves from using your information to take out loans and lines of credit
- Make it more difficult to access credit and develop better financial habits in the process
- No hard credit checks
- Your credit score is unaffected
Cons
- It will be harder to borrow capital
- You’ll have to lift the credit freeze leading up to a mortgage, personal loan, or similar financial product
- You must contact each of the three major credit bureaus to freeze your credit report
Credit Freeze vs. Fraud Alert: Key Differences
Both of these tools can preserve your finances, but it’s essential to know the differences between these resources. Fraud alerts notify you of potentially suspicious activity, but you must act to protect your credit. A credit freeze can add a layer of protection to your credit, but a fraud alert may be the only way that you know someone has stolen your identity.
Steps on How to Freeze Your Credit Report
Freezing your credit report may feel complex the first time, but it gets easier over time, especially if you follow these steps.
Gather Necessary Information
You will have to provide documents that verify your identity and address, such as your Social Security card, ID, and tax forms. Do not mail original documents. Send copies instead if you opt to mail your information.
Contacting Major Credit Bureaus
A credit freeze requires that you reach out to each individual credit bureau. These are the three companies to contact:
Equifax
Phone: 1-888-298-0045
Mail:
Equifax Information Services LLC
P.O. Box 105788
Atlanta, GA 30348-5788
Experian
Phone: 1-888-397-3742
Mail:
Experian Security Freeze
P.O. Box 9554
Allen, TX 75013
TransUnion
Phone: 1-800-916-8800
Mail:
TransUnion
P.O. Box 160
Woodlyn, PA 19094
Placing a Credit Freeze Online, by Phone, or by Mail
- Online: This is the quickest route, and your credit report will be frozen within one business day.
- Phone: This route also takes one business day to process.
- Mail: It will take longer for your information to arrive. The credit freeze should be enforced within three business days.
What to Expect During and After the Process
If you’re freezing your credit report for the first time, it can feel complicated. However, knowing what to expect during and after the process can make it more straightforward.
Verification Steps and Security Measures
Each of the major credit bureaus will request documents that verify your ID and address. These security measures help credit bureaus ensure they are speaking with the right person.
Confirmation of Credit Freeze
You will receive a confirmation message when your credit freeze is initiated. Then, you will have to contact the major credit bureaus again if you want to temporarily unfreeze your account.
Receiving and Safeguarding Your PIN or Password
Credit bureaus provide login details to help you freeze and manage your credit report. Managing this information will make it easier to lift the freeze on your credit report if necessary. While 6-digit PINs were common parts of the process, they are no longer necessary.
Managing Your Frozen Credit
These are some of the ways you can stay on top of your frozen credit.
How to Temporarily Lift a Credit Freeze
You must contact each of the major credit bureaus to temporarily lift a credit freeze. Consumers can also opt to permanently lift a credit freeze.
Steps to Permanently Remove a Credit Freeze
You will have to contact Experian, TransUnion, and Equifax to permanently remove a credit freeze. You will need to provide documents that verify your identification and address.
Keeping Track of Your Freezes Across Different Bureaus
Each major credit bureau has a mobile app and an online dashboard that lets you monitor your credit freezes. You can use these hubs to initiate temporary lifts or permanently remove your credit freeze.
Other Special Considerations
These are some of the other details to keep in mind when freezing credit reports.
Freezing Credit for Minors
Freezing credit for minors can be a smart move that limits how many credit cards they can use. It can also keep cyber criminals away from your kids.
Freezing Credit for the Elderly or Deceased
Some cyber thieves attempt to take out credit against an elderly or deceased individual’s credit. It’s important to place a freeze right away, as any illegal activity can impact the inheritance. It’s also possible that the deceased still has some debt that must be addressed before the inheritance is distributed among heirs.
Credit Freezes and Identity Theft Protection Services
Credit freezes are a part of identity theft protection services. Freezes prevent new credit accounts from being registered under your name. However, you will also have to freeze any compromised credit accounts in your financial profile, such as a credit card that has suspicious transactions. You can also sign up for fraud alerts and receive notifications about suspicious activities.
Resolving Issues with Credit Bureaus
Credit bureaus may notice issues with your application, especially if you do not provide sufficient documentation. Staying in touch with a representative and being courteous throughout the process can lead to a quicker resolution.
Additionally, when your credit report is frozen, it can complicate matters if you need to apply for loans or new credit. The Credit Pros understand the challenges that come with a credit freeze and are here to help you navigate this process efficiently. Their team of professionals specializes in working with credit bureaus to unfreeze your report and resolve any outstanding issues that may be affecting your financial health.
If you’re ready to address your credit freeze and regain access to your financial options, don’t hesitate to contact The Credit Pros at (727) 306-8201 or fill out this short form – no obligation required. Their expertise ensures that you receive the support needed to unfreeze your credit report smoothly and swiftly. With their proven and effective strategies, you can trust that they will work diligently on your behalf.
FAQs About How to Freeze Your Credit
A credit freeze will become effective within one business day if you call or submit your application online. It can take up to three business days for the credit freeze to become effective if you submit it by mail.
There are no fees associated with freezing your credit.
You will have to contact each of the major credit bureaus to temporarily unfreeze your credit report. The temporary lift takes place within one hour of submitting an online or phone application. The process for mail applications takes up to three business days.
