Have you been getting unfamiliar bills in the mail? Has your credit score gone down even though you’ve made all your payments on time? Have credit card statements appeared in your mailbox for cards you don’t own?
If you said “yes” to any one of these questions, you might want to consider freezing your credit.
Read our step-by-step guide and understand when you should and shouldn’t freeze your credit. If you decide that you need a freeze, follow our instructions as soon as possible to prevent further damage.
Why Would You Want to Freeze Your Credit?
A credit freeze is a strong type of protection that temporarily limits access to your credit. Freezing your credit doesn’t hurt your credit score, but it does prevent everyone from opening new lines of credit under your name.
People freeze their credit when they believe that they’ve been the victim of identity theft or fraud or freeze their credit as a preventive measure after a data hack.
Freezing your credit stops thieves from creating new accounts using your personal information. It can also provide a “paper trail” to help authorities catch the person who has stolen your data.
Credit freezes stop everyone from accessing your credit, whether they’re authorized by you or not. It’s easy to freeze your credit, but think long and hard before you pull the trigger. A freeze means that banks, lenders and credit card companies will deny any application or request that comes through with your name on it.
For example, let’s say that you freeze your credit and a scammer attempts to use your Social Security number to apply for a new credit card. The credit card company would process the application and request to view your credit report. Each credit bureau would deny the request because you’ve frozen the account. The credit card company would then reject the application because it can’t verify your credit score.
While credit freezes stop thieves from opening new accounts using your credit report, they also prevent you from accessing your credit as well. This means that if you freeze your credit and then submit a legitimate request for a new loan, your bank will deny the application.
Credit freezes also do nothing to stop criminals from using your data in ways that don’t require a credit check. For example, a credit freeze won’t stop a thief who already has your credit card from making purchases. This is why it’s important to only freeze your credit under specific circumstances.
Step 1: Contact Each Reporting Bureau
Under the Economic Growth, Regulatory Relief and Consumer Protection Act, credit freezes are free as of September 21, 2018. Each of the three credit monitoring agencies must now provide free credit freezes and unfreezes at your request.
They must also provide you with an easy way to freeze your account. As a result, most credit freezes take as little as 15 minutes when done online or over the phone.
There are three major credit reporting bureaus that issue credit reports: Experian, TransUnion and Equifax. If you want to freeze your credit, you need to contact each bureau individually. Bureaus don’t communicate with one another, so freezing only one account will still leave your liable. Here’s how to contact each credit bureau:
- Equifax Credit Freeze: You can freeze your Equifax credit report by calling 1-800-685-1111 (1-800-349-9960 for New York residents) or by creating an account with Experian’s online credit reporting center.
- Experian Credit Freeze: You can freeze your Experian credit report by calling 1-888-EXPERIAN (1-888-397-3742) or by visiting the online credit freezing center and entering your information.
- TransUnion Credit Freeze: You can freeze your TransUnion credit report by calling 1-888-909-8872. You can also create an account and freeze your credit online, the same way that you can with the other bureaus.
Keep in mind that after a data breach or widespread hack, you might have trouble immediately freezing your credit. You might have to call a representative more than once to get in contact with someone or you may have to request digital forms more than one time to get through during busy periods.
Step 2: Answer Verification Questions
Each credit bureau will need to verify your identity before it can freeze your credit. You’ll need to answer a series of questions about your identity, your credit report and credit you’ve used in the past. For example, you may see a series of credit items and may be asked to choose which one is actually on your credit report.
After the bureau verifies your identity, it’ll give you a PIN that you can use to freeze and unfreeze your credit. You’ll need to re-verify your identity if you forget your PIN, so be sure you keep your PIN somewhere where only you can access it.
Step 3: Request the Credit Freeze
You can request to freeze your credit after you’ve verified your identity. If you’re freezing your credit online, you can freeze and unfreeze it independently through your account. You can also temporarily unfreeze your credit if you’re applying for a job or a loan in the near future. If you want to unfreeze your credit after freezing it over the phone, you’ll need to call again to unfreeze it or create a profile online.
Keep in mind that freezing and unfreezing your credit isn’t an instant process. It might take a few days for your freeze or unfreeze to go into effect.
When You Should Freeze Your Credit
There are some instances in which it’s a good idea to freeze your credit. Consider freezing your credit if…
You think you’ve been the victim of identity theft. If you believe that a thief has actively stolen your identity and is using your data to open new accounts, you should freeze your credit.
There’s been a data hack or breach. You might remember the infamous 2015 Experian hack that left 15 million consumers’ sensitive data visible to identity thieves and hackers. However, credit reporting bureaus aren’t the only entities that can get hacked. A hack could happen with your credit card at a major retailer or your personal information could be on file at a large company, so freeze your credit report following a hack.
A thief has your credit card number. Freezing your credit will not stop a thief from using a credit card that you already have open. However, if a criminal already has some of your data, it can be easy to gain access to other sensitive information. Stay on the safe side while you cooperate with authorities and freeze your credit whenever you lose a credit card.
Your credit monitoring service alerts you to potential identity theft. You may get a free credit report at annualcreditreport.com every 12 months. However, credit monitoring services (like the one through MoneyLion) is constantly on the lookout for unusual credit activity. Freeze your credit as a precautionary measure if you receive an alert that your data might have leaked.
When You Shouldn’t Freeze Your Credit
A credit freeze isn’t always right for everyone. Here are some instances in which you may not want to freeze your credit.
Right before you apply for a loan or card
You can unfreeze your credit at any time, but it may take a while for the thaw to go into effect. Keep in mind that you also need to take time to contact each of the three reporting agencies to totally unfreeze your credit.
This can be especially true during high-traffic periods. Already applied for a loan or new job that requires a credit check? You’re better off leaving your credit visible until you get a decision.
When there’s no data hack or ongoing public threat
Now that credit freezes are free, some consumers have decided that it’s safer to leave their credit frozen all the time until they need to apply for a loan.
However, this is usually unnecessary unless there’s a present threat. It can also cause you to be wrongly denied a loan, job or opportunity if you forget to unfreeze your reports.
How Do You Unfreeze Your Credit?
Similarly to when you freeze your credit, unfreeze it by contacting each individual credit reporting bureau. Collect your PINs, enter them on your online account and request to unfreeze your credit at each individual bureau.
You have two options when you unfreeze your credit: a temporary lift or permanent removal.
- Temporary lift. As its name suggests, a temporary lift allows inquiries to pass through for a specified amount of time. After that time expires, your credit report automatically freezes again until you request another lift.
- Permanent removal. Permanent removals open your credit report to all valid inquiries, regardless of time. Despite its name, you can request another freeze at any time in the future.
Unfreezing your credit usually takes less than a day. However, during very busy periods or periods of system maintenance, you may have to wait a bit to unlock your credit. By law, the reporting agency has up to three business days to fully unfreeze your credit. It doesn’t cost anything to unfreeze your credit.
Protecting Your Credit Score and Financial Profile
Spotting errors and inconsistencies early is by far the best way to protect your credit — and your financial health. Freezing credit is a smart move if you think that you might have been the victim of identity theft.
But knowing how and when to freeze your credit is just one piece of the puzzle of overall financial health. Keep track of your credit score, check your credit report once a year and stay on top of reporting errors can all help you fight back against fraud.
Disclosure
MoneyLion Checking Account provided by, and MoneyLion Visa® Debit Card issued by, Lincoln Savings Bank, Member FDIC. Terms and conditions apply.
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Current Credit Builder Plus membership required for Credit Builder Plus loan eligibility; the $19.99 monthly fee will be withdrawn from your linked bank account. All loans with an Annual Percentage Rate of 5.99% are made by either exempt or state-licensed subsidiaries of MoneyLion Inc. The Credit Builder Plus loan may, at lender’s discretion, require a portion of the loan proceeds to be deposited into a reserve account managed by ML Wealth, LLC and held by Drivewealth LLC, member SIPC and FINRA. The funds in this account will be placed into a money market cash management or FDIC bank sweep vehicle, and may generate interest at prevailing market rates. You will not be able to access the portion of your loan proceeds held in the credit reserve account until you have paid off your loan, and so long as your Credit Builder Plus membership payments are current. If you default on your loan, your credit reserve account may be liquidated by the lender to partially or fully satisfy your outstanding indebtedness. May not be available in all states.Credit Reserve Accounts Are Not FDIC Insured • No Bank Guarantee • Investments May Lose Value. For important information and disclaimers relating to the MoneyLion Credit Reserve Account, see Investment Account FAQs and FORM ADV.
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