Placing a security freeze can ice out fraudsters trying to get credit under your name.

3 minute read

If you notice suspicious activity on your credit report, you may want to protect yourself from credit fraud by putting a security freeze on your credit. A credit freeze prevents most lenders, credit card companies and service providers from accessing and viewing your credit report and can stop people trying to fraudulently obtain credit under your name.

Suspicious activity on your credit report could be an unfamiliar inquiry or multiple inquiries from creditors accessing your credit report for loans or credit cards. Many people place a credit freeze on their credit after suspicious activity or if their identity was stolen.

Freezing your credit is easy. Placing a security freeze takes only a few minutes online with each of the major credit reporting agencies. However, a credit freeze is an extreme measure that can also delay access to your credit report if you need credit approval fast.

Below are five things to know before putting a security freeze on your credit.

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1. You must contact each credit bureau separately

For a credit freeze to be effective, you must contact each of the three major credit reporting agencies separately. The major credit bureaus won’t notify each other when you put a freeze on your credit, so placing a credit freeze with only one major credit bureau won’t stop creditors from pulling your credit report from one of the others.

You can place a security freeze on your credit in just a few minutes online with the three major credit bureaus: Experian, TransUnion and Equifax.

Find out: Should I Monitor My Credit with One Credit Bureau or All Three?

2. Freezing your credit is free

Placing a security freeze on your credit is free with all three major credit reporting agencies. If you want to take additional steps to protect your credit, all three agencies also offer products that you can purchase for broader credit and identity theft protection.

Find out: 6 Reasons You Could Be Denied Even with Excellent Credit

3. A credit freeze won’t prevent identity theft

While a credit freeze can stop someone from fraudulently opening a credit account in your name, a security freeze won’t prevent someone from stealing your identity in the first place. The freeze can only stop an identity thief from using your identity to open new accounts.

For example, a credit freeze won’t stop an identity thief who’s stolen your credit card from making purchases. However, it can stop the thief from opening a new credit card in your name.

Find out: 8 Mistakes to Avoid When Trying to Improve Bad Credit

4. A fraud alert could be a better option

If you’re worried that your sensitive personal information might have been compromised but don’t yet see evidence of fraud, a fraud alert may be a better option than a credit freeze, according to Experian. When you add a fraud alert to your credit report, any creditor trying to access your credit file must first confirm your identity before viewing your report.

Unlike with a credit freeze, you don’t have to notify each of the three major credit reporting agencies. When you add a fraud alert with one of the credit bureaus, that agency will notify the other two.

5. Don’t forget to lift the security freeze

Unlike with a fraud alert, which automatically lifts after a specified period, a credit freeze won’t simply thaw with the passage of time. If you want a security freeze removed, you must contact each credit bureau separately to have it lifted.

Just like when you place a freeze, you must contact each credit reporting agency to remove it. Removing a credit freeze is free and takes only a few minutes to go online and lift with Experian, TransUnion and Equifax.

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About the Author

Deb Hipp

Deb Hipp

Deb Hipp is a full-time freelance writer based in Kansas City, Mo. Deb went from being unable to get approved for a credit card or loan 20 years ago to having excellent credit today and becoming a homeowner. Deb learned her lessons about money the hard way. Now she wants to share them to help you pay down debt, fix your credit and quit being broke all the time. Deb's personal finance and credit articles have been published at Credit Karma and The Huffington Post.

Published by Debt.com, LLC