What is a Credit Freeze and How Is It Done?

A credit freeze makes your credit report inaccessible to lenders, which can help prevent identity theft. Even if a criminal has pertinent information, such as your Social Security number and birthdate, they likely can’t use it to open an account in your name without your credit files.

You must contact all three credit bureaus to freeze your credit. However, credit freezes are free, you can lift them at any time, and they don’t affect your credit score.

What is a credit freeze?

Lenders typically review your credit report when you apply for new credit or loans. This is to ensure you can handle more debt. A credit freeze, also called a security freeze, takes your credit report out of circulation, stopping lenders from accessing your credit score.

Without a credit score, lenders will likely deny your application. But at the same time, a thief can’t open new loans or lines of credit in your name.

It’s free to freeze and unfreeze your credit report as often as you like. Ultimately, freezing your credit adds an extra layer of security to your identity and accounts.

How to freeze your credit

You must contact each of the three credit bureaus to freeze your credit. Creating free online accounts with each bureau is the quickest way to manage your freezes. Alternatively, you can contact the bureaus via phone or mail.

What you need to freeze your credit

Although each credit bureau might require different material, here are some general documents you should have on hand:

• Social Security number
• Date of birth
• Current address (You may need to list all addresses from the past two years)
• Copy of a government-issued ID card, such as a passport or driver’s license
• Copies of utility bills or bank statements

You’ll likely need to answer security questions to verify your identity if you request a freeze over the phone. Once you’ve completed the freeze, your credit report will remain locked until you temporarily or permanently lift the freeze.

How to unfreeze your credit

If you go ahead with the freeze but then want to apply for new credit, you must unfreeze your credit first.

This process is often called “thawing” your credit, and it should only take a few minutes if you have online accounts with each credit bureau. Log onto each account and follow their steps to unfreeze.

You can permanently unfreeze your account or schedule a temporary thaw, which allows access to your report for a specified period, typically long enough to apply for more credit.

Requesting an unfreeze via snail mail will usually take longer. Follow the directions on each bureau’s website, or call them directly for assistance.

Alternatively, you can ask your new creditor which credit bureau they use for credit checks. For example, if your lender only uses Experian, then you’ll only have to unfreeze that one account.

Pros and cons of credit freeze

Consider the following advantages and disadvantages of freezing your credit.

Pros

  Free for everyone. As of September 2018, the federal government made freezing and unfreezing your credit free for all consumers.

  Protection from identity theft. A credit freeze makes it hard for thieves to open new accounts in your name, since lenders can’t access your credit report.

  Simple, easy and fast. Federal law requires all three national credit bureaus maintain websites where consumers can quickly freeze and unfreeze their credit. The government stipulates that credit bureaus must unfreeze your account within a specified time — one hour if requested online or by phone, or within three business days if requested by mail.

  It prevents credit bureaus from selling your data. Credit bureaus can share your information with potential lenders without your authorization. When you freeze your credit, you stop the bureaus from sharing your data, which can help reduce pesky pre-approval credit card offers. Unfortunately, some pre-approval offers will still sneak by, but you can opt-out for free by calling 888-5OPTOUT (888-567-8688).

Cons

  Managing freezes takes extra work. Although the bureaus’ online accounts make freezing and unfreezing a quick process, logging onto each site can still be a bit of a hassle (though it’s less work than dealing with credit fraud).

  False sense of security. A freeze protects you from criminals trying to open new credit lines or loans under your name, but fraudulent activity can still occur on existing accounts. If someone has access to your credit card information or Social Security number, they can still commit credit fraud. For maximum protection, you must closely monitor your accounts. (See more below.)

  Insurance rates might increase. Some insurance companies base their rates on your credit score. Contact your insurance agent to explain the situation if you receive a higher rate due to a credit freeze.

  Limitations with mySocialSecurity account. The government lets you set up an online account — called mySocialSecurity — for tracking earnings and future benefits. However, you’ll need to temporarily lift your credit freeze to set it up.

Credit freeze vs. credit lock

Both a credit lock and credit freeze block access to your credit report, making it difficult for fraudsters to open new accounts in your name. However, each offers a different level of protection.

• Credit freeze: A credit freeze is guaranteed and controlled by the federal government, making it a more secure option. You won’t face any financial liability if something goes wrong, such as someone gaining illegal access to your credit report. It’s free to freeze and unfreeze your credit report with the three credit bureaus.
• Credit lock: The three credit bureaus also offer a service to “lock” your credit, which is the same as a freeze but without the specific government protections. Although credit locks offer more convenience — such as being able to lock and unlock your credit with a quick swipe on an app — they may come with a fee.

Ultimately, your decision to lock or freeze your credit file comes down to the level of guarantee and convenience you’d like to have. For more information, visit the credit freeze pages for each individual bureau or use the resources found through nonprofit consumer help organizations, like the Identity Theft Resource Center.

Credit freeze vs. fraud alert

A fraud alert is another safety measure to help protect you against identity theft. Once activated, a fraud alert encourages businesses to contact you directly to verify your identity before approving a loan or credit card application.

  Note: Since the fraud alert doesn’t require extra verification, it’s not as secure as a credit freeze.

Unlike a credit freeze, you only have to contact one credit bureau to set up a fraud alert — they will contact the other two bureaus on your behalf.

Fraud alerts are free and last one year, but you can renew them annually. If you have a police report showing you were a victim of identity theft, you can request an extended fraud alert, which lasts seven years.

Additionally, when you place a fraud alert, you’ll automatically receive a free copy of your credit report from the three credit bureaus.

Picking the best solution — credit freeze or fraud alert — depends on your specific financial situation and what level of security you want.

How to monitor your credit for free

Monitoring your credit — like with free credit reports — can help stop fraudsters before they cause any damage. Plus, none of these services will affect your credit score.

• Credit monitoring service: Our LendingTree credit monitoring app provides free, personalized tips to help improve your financial health and boost your credit score.
• Free credit reports: You can access free credit reports from each bureau at AnnualCreditReport.com. Keep in mind, however, that your credit report doesn’t show your actual credit score.
• Check your credit score: You can access your current credit score with a free credit score tool.
• Enable account notifications: In addition to fraud alerts, you can request to receive text or email account alerts for all of your credit card activity. Once enabled, you’ll receive notifications for every charge, refund or other transaction on the card. Look for “account alerts” under your account’s settings to specify which alerts you want to receive. Although this might seem like overkill, it can be worth it for your peace of mind, especially if your account information has been compromised.