When you are dealing with fraudulent activity or potential identity theft, deciding what to do next can be overwhelming. Luckily, there is the option of freezing your credit so that no accounts or loans can be opened using your information, causing further damage.
What is a Credit Freeze?
A credit freeze is a process where your credit files are made inaccessible to potential lenders and other businesses. This means that you won’t have to worry about anyone being able to open another line of credit in your name, which can help you avoid debt traps from fraudulent activity. When you apply for a loan or other type of credit, the lender will contact one of the three major credit bureaus: TransUnion, Equifax, or Experian. If they find an issue with your file, they’ll contact the bureau and request that it be frozen.
How Can You Freeze Your Credit?
There are three credit bureaus you need to contact in order for you to freeze your credit and alert the of fraud:
- Equifax: Call 800-349-9960 or visit their website.
- TransUnion: Call 888-909-8872 or visit their website.
- Experian: Call 888‑397‑3742 or visit their website.
Documents You Will Need to Freeze Your Credit
Before initiating a credit freeze, you’ll need to make sure that all the necessary documentation is gathered in order to proceed. Here’s what different credit bureaus require:
- Passport, ID, or driver’s license
- Proof of residency, like a light bill
- Your address
- Date of birth
- Social security number
- Date of birth
When You Should Consider a Credit Freeze
The first thing you should know before freezing your credit is how it works. When someone freezes their credit, the information is locked in place. This means that the information cannot be accessed unless you unfreeze it. It also means that you are not able to take out a loan or borrow money from anyone until your credit has been unfrozen and you have applied for a new line of credit.
Credit freezes are also a great option to protect from identity theft. It can also be beneficial for protecting yourself from creditors who might try to collect on debts that you don’t owe.
What if You Need to Unfreeze Your Credit?
You can easily unfreeze your credit by contacting one of the 3 credit reporting bureaus.
Things to Consider When Freezing Your Credit
- A freeze is not a foolproof method of protecting your credit or other personal information. It can protect you from fraudulent activity on an existing account, but if the account has been compromised in any way (such as by fraud) then your personal info could still be at risk of being compromised.
- It certainly takes some effort to remember that you need to lift the freeze when you want to apply for credit. There is also a certain amount of inconvenience in not being able to redeem your funds if someone tries any other sort of fraud or identity theft.
Conclusion
As discussed above, you can protect your life’s earnings and your credit from the bureaus with a freeze. Freezes are a great way to prevent creditors from accessing your credit history, which will help you maintain your good reputation with your credit score.
Keep in mind that it’s important to have a plan of action in place before you freeze your credit. When following this guide, you’ll want to make sure that you’re not jeopardizing the life-altering financial decisions or tax forms you’ll need to file for the next few years.