What is a Credit Freeze?

A recent study found that while 75% of Americans know of the credit freeze process, 71% said they’ve never done it. Here is what you should know about an effective financial tool.

What is a Freeze?

A credit freeze is exactly what it sounds like — it freezes your credit report so no one can open new accounts in your name. And yes, that includes you.

• What if I Try to Open a New Account? You can temporarily pause the freeze if you are looking to open a new card or are planning on applying for a loan or mortgage.
• Fees? A credit freeze is free and does not hurt your credit score.

Why Consider a Credit Freeze

A credit freeze is a good way to prevent hackers and cybercriminals from stealing your credit data and personal information and using it against you.

Who is a Good Candidate for a Credit Freeze?

• If you’ve been a victim of identity fraud or theft
• Affected by a major data breach
• Seniors. (Sadly, they are heavy targets for fraudsters.)
• If you rarely use your credit

When to Freeze Your Credit

Consider your financial situation before freezing your credit. If you’re applying for a credit card or a mortgage any time soon, it makes sense to wait for the freeze because lenders won’t be able to check your credit. If they can’t check your credit, the approval process will be delayed. 

The Process to Freeze Your Credit

To freeze your credit, you contact the credit bureaus directly.

• Contact. You can freeze your credit at each major credit bureau: TransUnion, Equifax, and Experian.
• Personal Data. You’ll need to provide personal info like your Social Security number and birth date.
• Create a PIN. You’ll also be asked to create a PIN to access the freeze later when you want to disable or pause it.

Do One Thing: Freeze your credit to protect yourself against identity theft.