How to Freeze Your Credit for Free

By February 28, 2019Credit Cards
Man stealing an id

Identity fraud is a growing problem throughout the world and can have a devastating effect on your credit. Identity thieves target personal and financial information to gain access to consumers’ existing accounts or to open new accounts under a false identity. Once they do, they can have free reign over your finances.

Luckily, there are ways you can protect yourself as much as possible against this problem. Common sense is helpful when you receive a phone call or email from someone asking for information while claiming to be from your bank, credit card company, or even the IRS. But even if you have your guard up, you can include an additional level of security by implementing a freeze on your credit report. And best of all, it’s now a free service offered by credit bureaus.

We’ll walk you through the process from start to finish so you know exactly what is included with a credit freeze and how to add one to your own credit report.

What is a Credit Freeze?

A credit freeze denies creditors access to the information found on your credit report. Since credit card companies and lenders run a credit check before issuing any type of loan or card, any fraudulent application made under your name should be denied if a check can’t be performed. While it’s not a foolproof method, it certainly reduces the chances of having an identity thief successfully open a new account under your name.

Just remember that when you’re ready to apply for an authentic new type of financial product, you’ll need to remove the freeze. That can be anything from applying for your own new credit card or paying an installment loan such as a mortgage or car loan. Build in time prior to submitting your application to get the credit freeze lifted since it can take a few days to go into effect. Once you get approved for the credit, you can put a freeze back on your credit.

This is also a good tactic to use for children. Some identity thieves and scammers target social security numbers of minors because their credit reports typically aren’t checked for years. It can be a huge nuisance for someone in their late teens or early 20s who goes to apply for a credit card or student loan only to find out that their history is already full of credit errors from fraudulent accounts.

How Do You Freeze Your Credit for Free?

Historically, credit freezes cost around $10 to implement with each credit bureau, which is quite an expensive service. New legislation, however, has favored consumers by requiring the credit bureaus to offer credit freezes for free. Contact each credit bureau directly to enact a freeze: Equifax, Experian, and TransUnion.

You’ll receive a PIN that is specific to your account and you’ll need that number anytime you want to lift a credit freeze. It’s a cumbersome process to replace your PIN and verify your identity, so keep it in a safe and secure place until you need it.

Can a Credit Freeze Help with Credit Repair?

Placing a credit freeze on your credit report won’t help with existing credit errors; it’s primarily used for preventative measures. In that way, though, you can better avoid needing a new credit dispute due to potential negative items caused by fraudulent accounts on your credit report.

Another way to help limit damage and improve your credit is to access your free credit reports each year. You can order your own credit reports even if you have a credit freeze in place. In fact, some other third parties such as your existing creditors can also still access your credit report to confirm your eligibility for certain APRs, for example.

Once you get a copy, check your report from each bureau to make sure there aren’t any red flags. If you see an account or balance you don’t recognize, call the listed creditor for more information. If you have been the victim of identity theft, your first step is to get the account stopped so no more spending can take place. From there, work on fixing your credit either on your own or through a professional credit repair company. Unfortunately, even other people’s fraudulent activity can hurt your credit history, regardless of how unfair that seems.

You can help expedite the process and get your financial footing back by talking to a firm like Ovation Credit. Our legal team has the experience to get your credit report back to the way it should be as quickly and efficiently as possible.

While identity theft can be prevented with a free credit freeze, you can fix any incidents that do happen with Ovation. Sign up for a free consultation to learn more.

Sources:

https://www.northwesternmutual.com/life-and-money/you-can-now-freeze-your-credit-for-free/

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