Identity theft is a very real threat. I don’t need to tell you what kind of a serious impact it can have on your life. If you happen to become a victim, one of the options you have available is a credit security freeze. However, it is first important to understand exactly what this means and what steps you need to take if you plan to go through with the freeze.
What Does a Credit Security Freeze Do?
During a credit security freeze, you will tell the major credit bureaus – Equifax, Experian, TransUnion – to forbid new creditors from viewing your credit score and report. Businesses do not typically lend money or give credit to someone if they are unable to check their credit report, so this can stop any new and fraudulent accounts from appearing on your credit report. Thieves who have your information and who realize that you placed a freeze on your credit will be less likely to try to open new accounts. If they do, it could actually make it easier to track them down. Freezing your credit does not have a negative effect on your credit either.
How Do You Set Up a Credit Security Freeze?
Freezing the credit reports is relatively easy. You need to get in touch with each of the three credit bureaus. Provide them with your personal identifying information, such as your DOB, name, and Social Security Number. Freezing the account has a fee, but it is small – between $5 and $10 depending on where you live.
Once you start the freeze, you will receive a PIN, or personal identification number, from each of the bureaus. Keep the PINs safe. You will use them for lifting and reinstating credit freezes. Starting and stopping the freeze will require a fee every time you do it. lifting and reinstating. You may want to keep the freeze on your credit OFF if you plan on doing things like opening credit cards, getting loans, buying a car or house, etc.
Because of the fees, and the fact that they can pile up when you are trying to do something such as getting a loan for a car or for a home, it might be a good idea to wait to initiate the freeze until you finish that piece of business. It is also important to keep in mind that even though the freeze will stop thieves from opening new accounts, it will not stop them from having access to your other accounts that are already open.
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While it might be beneficial to some, always think through the pros and cons of a credit security freeze, just to make sure it is the right decision for you.