How to Freeze Your Credit Report at All Three Credit Bureaus
Freezing Your Credit Report Can Prevent Identity Theft
Identity theft is a major concern these days and advancements in technology continue to aid criminals in perfecting their skills and techniques. However, beyond your standard identity theft tips you can go one step further and consider a credit freeze.
When a person wants absolute assurance that criminals will not be able to access their credit accounts, they can request that a freeze be placed on their credit reports. When a credit report freeze is in place, no one can open a credit card account or take out a loan or mortgage in the account holder’s name, not even the account holder. The freeze can be lifted or “thawed” by using the Personal Identification Number (“PIN”) or password which is given by the credit bureaus when initially requesting the freeze. However, a credit report freeze doesn’t usually apply to account relationships already in existence as these creditors, lenders, etc. will still have access to reports to fulfill basic activities such as account reviews and fraud control.
All states with the exception of Alabama, Michigan and Missouri have adopted the mandatory security freeze laws. The states of Arkansas, Kansas, Mississippi and South Dakota limit this protection to identity theft victims only. However, Equifax, Experian and TransUnion now extend credit freezes to all who request it, even if they reside in the states which haven’t yet approved this process in whole or in part. These three major credit bureaus request the same information in variation:
- letter sent via certified mail with requestor’s name, address, date of birth and SSN;
- copy of utility bill;
- copy of driver’s license;
- police report if the person is a victim of identity theft;
- past addresses dating back two years; and
- payment for processing fee.
A freeze should be requested at all three bureaus in order to be effective and a person should confirm exactly what is needed with each bureau. Credit report freezes are free for identity theft victims but for those who are requesting it as a preventive measure, the fee is usually between $5 and $10 at each bureau and for most states. In addition to the three major credit bureaus, consumers should also check the laws in their own states regarding this process as requirements and fees will vary.
- Equifax Security Freeze, P.O. Box 105788, Atlanta, GA 30348 [Online Application ]
- Experian, P.O. Box 9554, Allen, TX 75013 [Online Application ]
- TransUnion, Fraud Victim Assistance Department, P.O. Box 6790, Fullerton, CA 92834 [Online Application ]
Fraud Alert vs. Credit Freeze
There are similarities as well as differences between credit freezes and fraud alerts. Neither prevents a person from accessing the credit they already have. With fraud alerts, electronic red flags are placed on credit reports at all three credit bureaus. In an effort to prevent fraudulent actions from occurring, verification of the identity of someone who applies for credit under a name that has this red flag is supposed to be checked into more thoroughly. On the other hand, when an application for credit is submitted under a frozen account, the only information that will be shown is a code stating that all reports under this name are frozen and there is no further access to the account.
For the legitimate consumer, the down side to a credit report freeze is it could delay, interfere with or prohibit the timely approval of any financial requests or applications occurring after the freeze is in place. If a consumer wishes to temporarily lift the freeze to complete a specific application process (i.e. applying for a loan), they can do so but they will have to pay to unfreeze their files and pay again to put the freeze back into place. To activate the thaw, temporary or permanent, the consumer must present the following information to the credit bureaus:
- information verifying identity;
- PIN or password given; and
- A letter requesting the removal of the freeze, and if temporary, either the name of the person or business to have access to the credit files or how long the files should remain available.
Putting fraud alerts into place is free and is a simple procedure of calling all three credit bureaus. Putting a credit freeze into place is a more involved process and therefore should entail thought, consideration and planning before deciding to execute the process. Of course, if you aren’t in the market for a loan and won’t need to borrow money for a while the freeze is a surefire way to prevent somebody else from using your credit.
My name is Jeremy Vohwinkle, and I’ve spent a number of years working in the finance industry providing financial advice to regular investors and those participating in employer-sponsored retirement plans.