How to freeze your credit and protect your FICO Score
Good credit is essential — so you want to make sure yours is safe.
Contributing Writer at Tally
January 20, 2020
Credit affects so many aspects of our lives. Financial institutions review your credit history to decide on whether to approve a credit card or a mortgage application. Even landlords and auto insurers may check your credit, so protecting your FICO score is a smart choice.
The FBI reports that more than 350,000 complaints of fraud, including identity and personal data breaches, were filed in 2018. Fortunately, a recent federal law gives you more freedom to protect yourself (and your money) by requesting a credit freeze if something seems amiss.
What is a credit freeze?
A credit freeze (also known as a security freeze) stops creditors from accessing your credit file. Creditors accessing your file can be a good thing if you’re applying for a home mortgage, but it can be trouble if someone is using your identity to apply for a credit card.
The Federal Trade Commission (FTC) has passed a federal law to protect you from this issue. You now have a right to request a credit freeze for up to one year — for free.
Why do I need a security freeze?
A security freeze stops creditors from accessing your credit file for a time range of three months to one year. Freezing your credit would be a good idea if:
You notice unusual activity or new accounts on your credit report.
You receive a medical or insurance bill you don’t recognize.
Your information was compromised in a data breach.
Your Social Security card was lost or stolen.
Your mail has been tampered with.
You’re a victim of identity theft.
Pros and cons of a credit freeze
Knowing how to put a freeze on your credit is vital to keep identity thieves from ruining it. If one late fee can drop your credit score enough to affect your chances of qualifying for a credit card, then imagine what could happen if someone had access to your credit.
But there are disadvantages to freezing your credit report. When you create a security freeze, you won’t be able to apply for a line of credit, mortgage, credit card or car loan without lifting the freeze first. Weigh the following pros and cons to decide if it’s the best option in your case.
Freezing your credit pros
No one can access your credit report to open new credit accounts in your name.
A credit freeze doesn’t negatively affect your credit score.
You’ll stop credit checks, which can
A security freeze is free.
You can still receive your
to monitor your credit.
Credit freeze cons
Freezing your credit can provide you with some relief from unauthorized access to your credit report, but it can also have its drawbacks such as:
Your employer or auto insurance company will not be able to access your credit report, which could affect your job application or vehicle insurance rate.
You’ll need to lift a freeze by contacting all three major credit bureaus to give a creditor access to your file.
A credit freeze doesn’t stop fraudsters who already have access to your bank accounts or credit cards from making unauthorized purchases.
A credit freeze doesn’t apply to your current creditors, even if the credit application may be fraudulent.
Credit freeze alternatives
Not everyone needs to lock down their credit, especially because unfreezing your credit report takes some time and effort. There are alternatives to a security freeze that can safeguard your personal information. If you need access to your credit in the next year, consider one of the following alternatives:
Regularly monitor your spending activity
You have a right to request a free annual copy of your credit report. Make it a habit to look it over and make sure there aren’t any unusual inquiries or credit lines you didn’t apply for. Check your credit card and bank statements for any unusual activity. Preventative maintenance can stop the damage before it gets out of hand.
Report lost or stolen credit cards
If your credit cards are lost or stolen, you may not need a credit lock from the credit bureaus. Instead, contact your card issuer to close the account. In most cases, someone with access to your credit card number can run up unauthorized charges but can’t access your credit information. And you’re not responsible for unauthorized credit card charges over $50, as long as you report the loss right away.
Set up a credit alert
Besides having access to free credit freezes, you also have the right to request a credit or fraud alert for your credit file. If your account has a fraud or credit alert set up, creditors must call you to verify that you actually applied for credit before they act.
You only need to set a credit alert by contacting one of the three credit reporting agencies via phone or by visiting one of their online fraud alert centers. Once you file a fraud alert, the credit bureau will notify the other two on your behalf. There are three types of fraud alerts you can request:
A one-year temporary fraud alert
A one-year active duty fraud alert if you’re deployed overseas military
A seven-year extended fraud victim alert if you can show you filed an identity theft report with a state, federal or local law enforcement
Sign up with a credit monitoring service
In case of a widespread security breach, a company must offer potential identity theft victims access to free credit monitoring services. You can also sign up for services such as LifeLock and PrivacyGuard at your expense and let them keep an eye on your credit report.
How to put a freeze on your credit
If a credit freeze is the best option for your situation, here’s how you can put a freeze on your credit. You can request one online, by phone or by mail. A phone call may be the fastest way to take care of the situation while a mail request takes longer.
How to freeze your credit online with Experian, Equifax and Transunion
To complete the security freeze, visit each of the three credit bureaus:
You’ll need to file one with each credit bureau. Start by setting up an account and providing your name, address, Social Security number, date of birth and identity information for verification. Once the freeze is set up, you’ll receive a personal identification number (PIN). Keep it in a safe place — you’ll need it to unfreeze your credit report.
How to set up a security freeze by phone
Calling may be the fastest way to set up a credit freeze, especially when it’s time to lift it. You’ll need to request a freeze from all three. Here are the phone numbers for each of the bureaus.
How to request a credit freeze by mail
Send a certified mail request to each credit bureau with a return receipt to confirm it was received. Once it’s processed, you’ll receive a confirmation letter in the mail with a PIN for unfreezing your account.
How to lift a credit freeze
You may need to temporarily lift your credit freeze to move or apply for a credit card so your creditor or landlord can have access to your credit report. If you need to lift your security freeze before it expires, you’ll need your PIN or login information. Unless you know which credit bureau a potential landlord, employer or credit card provider will use, lift your credit freeze by contacting all three bureaus.
Calling to unfreeze your credit is fastest — the credit reporting bureaus must unfreeze your credit file within an hour after your phone request. You’ll only need your PIN for phone calls or mail requests. To lift the freeze through the online portal, logging in is enough.
Does a credit freeze protect your credit score?
Using a credit freeze to stop creditors from accessing your credit file can protect your credit from someone who has unauthorized access to your personal information.
Besides locking your credit file down, there are other steps you can take to protect and improve your credit score. Monitor your credit by ordering a free credit report every year. Use a mobile app like Tally — it automates your credit card payments by making your payments on time to get you out of debt faster. A good credit history pays off in the long run by making the journey towards financial freedom easier and less expensive.