Data breaches increased by an alarming 33% from 2018 to 2019, leaving some to consider if a credit freeze is the best way to keep sensitive information away from thieves.
But what does a credit freeze entail and what are the protections exactly? Let’s take a look.
What is a Credit Freeze?
Also known as a security freeze, a credit freeze is intended to block identity thieves from using your information to open an account or apply for a loan in your name. Essentially, if a credit freeze is in place, a potential new creditor or lender should be notified when (or if) they attempt to run a credit check using your information. This should potentially raise a red flag and (hopefully) prevent the thief from being successful in opening an account.
Should You Freeze Your Credit?
Deciding if you should freeze your credit depends first on whether or not a credit freeze offers the type of protection you’re looking for. Here are some things it generally can and cannot do:
It can potentially prevent someone from opening a new account in your name.
A credit freeze can potentially provide an extra layer of security in preventing someone from opening new accounts and negatively impacting your credit in the process. However, it’s possible for a lender or creditor to extend credit without running a credit check (as may be the case with payday loans, for instance), so there are no guarantees.
It can impact your ability to open new credit accounts as well.
If you are hoping to apply for credit, open a bank account, or need to have your credit checked by a potential landlord, employer, or insurance underwriter, you may have to temporarily lift the credit freeze. While a credit freeze generally must be lifted within an hour if the request is submitted online or over the phone, if it’s sent by mail, it can take as many as three business days after the request is received.
The upside? If you have trouble impulsively applying for new credit accounts — like retail credit cards, for instance — a credit freeze might be a helpful barrier.
It cannot prevent identity theft completely.
Information pertaining to your current accounts can still be obtained other ways — like data breaches — potentially allowing thieves to make fraudulent charges, file tax returns in your name, and more.
This just means it might be smart to take additional precautions in addition to freezing your credit if you’re concerned about identity theft.
It cannot prevent certain entities from accessing your credit report.
According to the Federal Trade Commission (FTC), your credit report may still be accessible to current or past creditors or lenders, as well as debt collectors working on their behalf. Certain government agencies may have access as well.
It cannot stop companies from sending you prescreened credit offers.
Sick of drowning in offers for insurance, credit cards, and loans? Unfortunately, the FTC says a credit freeze won’t stop them. But if you do want to opt-out of getting these offers, you can submit an online request for a 5-year opt-out or print and mail a request for a permanent opt-out here. (You can also elect to opt back in to receive these offers here.)
How to Do a Credit Bureau Freeze
If you aren’t seasoned in the facts about credit reports and credit scores, there are a few things that can be helpful to know.
There are three credit bureaus or credit reporting agencies (CRAs) — TransUnion, Experian, and Equifax. Creditors and lenders are not required to report information to all of them (or any of them). This means the information each bureau has about your credit history may be different. In addition, they all operate separately, and may not communicate certain information between them — like when you want to put a credit freeze in place.
If a thief attempts to open credit in your name, there’s no telling which credit report a creditor may pull. Therefore, you’ll probably want to initiate a credit freeze with all three bureaus.
Here are some ways you can do it:
- Online: You can create an account and establish your TransUnion credit freeze here. Once you establish an account, you can choose a PIN that would be required should you decide to lift the freeze by phone or mail (you don’t need to supply the PIN if you are submitting the request through your online account). You can also access your account (and easily establish or lift a freeze) by downloading the TransUnion app.
- Phone: You can request a credit freeze through an automated system or by speaking to an agent at 888-909-8872. Make sure you are ready with identifying information and be prepared to document your PIN number for safe keeping.
- Mail: You can also submit a request for a TransUnion credit freeze by mail. According to NerdWallet, you will need to include your name, address, Social Security number, and copies of documents proving your identity (a copy of your driver’s license, passport, utility bill with your name and address, etc.).
Mail everything to:
P.O. Box 2000
Chester, PA 19016
- Online: Set up your Experian credit freeze and online account here. You can permanently or temporarily lift the freeze by supplying your PIN and submitting your request through your online account.
- Phone: You can request a credit freeze by calling 1-888-EXPERIAN (1-888-397-3742).
- Mail: According to Experian, to submit your credit freeze request by mail, you should include a copy of your photo identification, proof of address (i.e. a recent bill), and your Social Security number.
Mail everything to:
Experian Security Freeze
P.O. Box 9554
Allen, TX 75013
- Online: Set up your Equifax credit freeze by establishing an online account here. You can lift or remove a credit freeze through your online account as well.
- Phone: Request a credit freeze by calling (888) 298-0045. In order to verify your identity, you can choose to receive a one-time PIN by text, or answer questions related to items on your Equifax credit report.
- Mail: You can download and print the required form to submit your Equifax credit freeze by mail here. According to Equifax you will need to submit either a copy of your Social Security card, a copy of a pay stub that includes your Social Security number, or a copy of a W2 or 1099 form. In addition, you will also need to include a copy of your driver’s license/state identification card, a copy of your rental lease agreement/house deed, a copy of your pay stub that includes your address, or a copy of a utility bill (that includes your name and address). The same form (and documentation) should be used whether you are placing a credit freeze, temporarily lifting it, or permanently removing it.
Mail everything to:
Equifax Information Services LLC
P.O. Box 105788
Atlanta, GA 30348-5788
A Few More Facts
Still not sure if a credit freeze is what you’re looking for? Here are a few more things that may be helpful to know:
It’s free to set, temporarily lift, and permanently remove a credit freeze.
In 2018, after an Equifax data breach exposed sensitive information of 148 million Americans, a new federal law was passed that allowed people to freeze and unfreeze their credit without being charged. Previously, in some states it could cost anywhere from $3-$12 to place and lift a freeze — times three for each CRA.
You can freeze your child’s credit report as well.
If you’re concerned about identity thieves establishing accounts, filing taxes, or applying for benefits using your child’s Social Security number, it’s possible to place a freeze on their credit report as well. Learn more here.
Your credit score should not be impacted.
According to Experian, a credit freeze should not affect your ability to qualify for loans and credit cards. However, activity on your current credit accounts will continue to be reported to CRAs, and your credit score may continue to change as a result.
Ready to take charge of your credit? Get the facts about credit scores and credit reports with our comprehensive guide and see how Upturn can help you dispute credit report errors for FREE.