Paycheck Chronicles

You Can Now Freeze Your Credit for Free

Credit Report

Thanks to a new law you can freeze access to your credit report for free.

Previously, it could cost you up to $10 to have a credit reporting agency freeze access to your credit report. There are 3 major credit reporting agencies.

What Is A Credit Freeze?

Credit freezes, also known as security freezes, restrict access to your credit file, making it harder for identity theft. With a credit freeze nobody except your existing credit card companies and banks can see your credit report. That means that fraudsters have a very hard time opening a new account in your name. Creditors almost always want to see your credit report before they open a new account for you.

If you have a credit freeze and decide to open a new credit card or get a loan you can temporarily lift the freeze by contacting the credit agencies.

How Do I Place A Freeze On My Credit Reports?

Contact each of the nationwide credit bureaus:

You'll need to supply your name, address, date of birth, Social Security number and other personal information. 

After receiving your freeze request, each credit bureau will provide you with a unique PIN (personal identification number) or password. Keep the PIN or password in a safe place. You will need it if you choose to lift the freeze.

If you request a freeze online or by phone, the agency must place the freeze within one business day. If you request a lift of the freeze, the agency must lift it within one hour. If you make your request by mail, the agency must place or lift the freeze within three business days after it gets your request. You also can lift the freeze temporarily without a fee.

Other Credit Security Measures

Credit Locks

Some credit companies may try to sell you a credit lock when you request a credit freeze. This is basically the same thing as a credit freeze, except that it costs you. Don’t confuse freezes with locks. They work in a similar way, but locks may have monthly fees. If you want a free freeze guaranteed by federal law, then opt for a freeze, not a lock. 

Fraud Alerts

A fraud alert notifies potential creditors and lenders that you’ve been (or suspect you’ve been) a victim of identity theft or fraud. It’s free to place a fraud alert, and you can remove it anytime. Normally fraud alerts last for one year, but if you have been the victim of a reported credit theft you can get one that lasts for seven years.

With a fraud alert, credit agencies must contact you before opening any new accounts in your name.

Credit Freezes And The Military

If you’re in the military, you have access to active duty alerts, which let you place a fraud alert for one year, renewable for the time you’re deployed. The active duty alert also gives you an added benefit: the credit reporting agencies will take your name off their marketing lists for prescreened credit card offers for two years (unless you ask them to add you back on).

Free Credit Report

As always, you're entitled to one free copy of your credit report every 12 months from each of the three nationwide credit reporting companies. Order online from annualcreditreport.com, the only authorized website for free credit reports, or call 877-322-8228. You will need to provide your name, address, social security number, and date of birth to verify your identity.

Don't Forget The Kids

Reports show, and you wouldn't think it, but some scammers are stealing personal information of newborns and opening credit cards in their name. That is why it is also important to be aware of your children's credit information.

While you may be really good about staying on top of your credit score, you don't normally think to check out your kid's information. I know I have gotten credit card signup offers for my kids at home when they were as young as five. 

Now that credit freezes are free you should consider getting a credit freeze for your kids. If they are under 16 and you are their guardian, conservator or have a valid power of attorney, you can get a free freeze for them, too.

Does A Credit Freeze Affect My Credit Score?

Nope, a credit freeze, fraud alert, or free credit report request have no affect on your credit score. This is federal law.

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