Should You Freeze Your Credit?

Thanks to conflicts around the world — which bring an increased risk of cyberscams — experts have suggested keeping a close watch on your credit. 

Having a good credit score carries a lot of weight in the modern world. It makes it easier for you to buy a home, lease a car, and even get approved for an apartment. So, if you’ve received a notification that your information has been compromised, you’ve lost your purse or wallet with all of your personal identification, or you’ve started getting mail about offers you’ve never claimed, you’ll likely want to act fast and set up a credit freeze. Doing so protects you against potential fraud: Creditors will no longer have access to your credit report, thus making it more challenging for new accounts to be opened in your name. 

Freezing your credit is surprisingly easy to do, and best of all, it’s free. Here’s what you need to know.

When To Freeze Your Credit 

According to Joel Steele, entrepreneur and co-owner of Steele Financial Solutions, “there are mostly pros and minimal cons” to freezing your credit — but it’s important to know  when you should do so. 

Steele doesn’t recommend freezing your credit proactively, because if you’re trying to get a mortgage or take out a loan for a car, “you may shoot yourself in the foot if your credit is frozen,” he says. “That means no new credit can be issued to you.” And even though data breaches are frequent, “that doesn’t mean your data will be successfully accessed or used.” 

Instead, Steele suggests reviewing your accounts every week or two for suspicious activity. If you have one fraudulent charge on a credit card, you don’t need to freeze your credit; in that case, dispute the charge and get a new card. But you should definitely freeze your credit if you see signs of potential identity theft, such as “things coming to your email inbox or physical mailbox with your name, but someone else’s info or someone else’s name and your info,” Steele says. Other common signs include getting collection calls for accounts you didn’t open, and your credit report showing new credit cards you never applied for. 

In that case, Steele says, “a freeze is the best and quickest solution to prevent future damage.” 

How To Freeze Your Credit

If you want to freeze your credit, you’ll need to do so with each of the three major credit bureaus: Equifax, Experian, and TransUnion. The process is similar across all three, based on whether you want to freeze your credit online, by mail, or by phone.

Equifax

Online via their website
By phone: 1-888-378-4329
By mail to: Equifax Information Services LLC 
P.O. Box 105788 
Atlanta, GA 30348-5788 

Be sure to download their online forms and include the requested necessary information, such as proof of identity and proof of address.

Experian

Online via their website
By phone: 1-888-397-3742
By mail to: Experian Security Freeze
P.O. Box 9554
Allen, TX 75013

Per Experian.com, your written request needs to include:

1. Your full name
2. Social Security number
3. Complete addresses for the past two years
4. Date of birth
5. A government issued identification card, such as a driver’s license
6. Copy of a utility bill or bank statement

Transunion

Online via their website
By phone: 1-800-916-8800
By mail at: TransUnion
P.O. Box 160
Woodlyn, PA 19094

With your mail-in request, include photographic copies of one proof of identity and two proofs of your current address. Make sure the documents show your current name and aren’t expired. Anyone under the age of 18 will need an adult or guardian to do this for them, and active-duty service members can have an authorized representative complete the process.

When Does the Freeze Take Effect — And Can It Be Undone?

If you decide to freeze your credit by phone or online, it typically happens within an hour of you contacting the credit bureau. By mail, it can take about three business days. Managing your freeze online means you can monitor it and easily lift the freeze when needed. 

If you’re concerned about more fraud or identity theft than what you’ve already found, “don’t unfreeze [your credit] until you’ve gotten some answers on what happened, how deep [it ran], and what’s the chance it continues when you unfreeze,” Steele says. When you’re ready, making a phone call to the three credit bureaus or going into your online account can easily undo a freeze.

Alternatives to Freezing Your Credit

A credit freeze isn’t the only option if you’re concerned about fraud. One step you might want to take is to set up a fraud alert. This requires creditors to take extra steps to confirm your identity before issuing credit. You can set up a one-year alert, a seven-year alert, or an active-duty military fraud alert. The process is similar to freezing your credit, as you can request a fraud alert online, by phone, or by mail at Transunion, Experian, or Equifax. 

Credit locks are another option you can pursue if you’re worried about fraud. They often come with a small fee, however, as they’re typically part of a premium credit monitoring package. Experian CreditLock, for example, costs $24.99 per month, and it functions similar to a credit freeze but with features such as data exposure alerts, real-time alerts, and identity theft insurance. 

How To Avoid Future Problems

Steele says the best way to avoid credit issues is by “being vigilant and monitoring your own accounts” on a routine basis, which he calls “your best defense.” That’s especially true in times of conflict, when cyberterrorists from other countries might be trying to get your information. He recommends looking out for any unusual credit card activity or unrecognizable charges, and checking your credit report activity a few times a year to “make sure you didn’t miss anything.”Transunion, Experian, or Equifax all allow you to check your credit score for free and monitor your credit report for updates. 

Featured Image Credit: © damircudic/iStock