With so many data breaches making the news, you might be concerned that some of your personal data has been compromised, giving identity thieves easy access to your sensitive information and credit.
You might even have been stung by someone applying for a credit card or other account in your name. That’s why some people feel the need to freeze their credit reports. However, this need not be permanent, and you can also lift a credit freeze.
What is a credit freeze?
A credit freeze, or security freeze, allows you to block access to your credit so that no one can open accounts in your name. This is done free of charge, based on federal law after you put in a request with the three credit bureaus. It does not affect your credit score.
Since creditors will typically want to look at your credit report before granting you credit, identity thieves cannot open accounts in your name. In case a creditor wants to review your credit, it will be notified that your credit is frozen. It’s best to put in a credit freeze request with all three credit bureaus, the California attorney general advises, since lenders will check your credit with different credit bureaus.
How to put in a credit freeze
You could put in the request to Equifax, TransUnion and Experian either online, by phone or in written communication. Be prepared with your personal information, such as your Social Security number and address. The credit bureau will provide you with a personal identification number or password for this transaction. While an online or phone freeze should go into effect in as little as an hour, it can take three days after a credit bureau receives your written communication for it to be done.
A credit freeze is different from a credit lock or fraud alert. A credit lock is a paid service provided by the credit bureaus that enables you to lock your own credit. A fraud alert warns lenders that they should verify your identity before extending credit since you suspect that your identity has been compromised. They will be able to access your credit report after confirming your identity with you. While this will prevent someone from opening a new account in your name, you will still have to monitor your existing accounts to make sure there are no spurious charges.
Reasons to lift a credit freeze
What if you are looking to take out a new line of credit, maybe applying for a no-annual-fee credit card or a mortgage, after you put in a credit freeze? You will have to lift the credit freeze temporarily to enable lenders to get your credit report.
If you are applying for a job and an employer needs to do a credit check, or if you are looking to rent a house and a landlord wants to check your credit, you could also temporarily unfreeze your credit for such purposes.
Even with a credit freeze, some entities will still have access to your credit report. For instance, your existing creditors or collection agencies representing them will be able to access it. Other lenders would also be able to access it to make preapproved offers of credit.
Some government agencies will be granted access to your credit report for purposes related to child support payments or taxes. A court order, subpoena, search warrant or administrative order would also allow some agencies to see your credit report.
How to lift a credit freeze
The process for lifting a credit freeze is similar to that for putting one in. You will need to contact Equifax, TransUnion and Experian. Be prepared with the PIN each bureau provided you at the time you initiated the freeze. If you lift the credit freeze online or by phone, it should be done in an hour. If you go through the mail, it will take three days after they receive your communication for the credit freeze to be lifted.
If you know which particular bureau a prospective lender or employer will choose to look up your credit, you can lift your credit freeze just at that one. Otherwise, you will have to go through the process with all three of them.
Additionally, you could offer one-time credit access to a particular entity—for instance, if you want a landlord to approve your tenancy. Or, you could lift the freeze for a specific time frame, which may be a better option if you are shopping for a loan with multiple lenders.