what does it mean to lock my credit report

12 Min Read | Mar 16, 2022

Identity theft is the worst. And sadly, it'southward happening more and more these days. At present, it'southward no longer a matter ofifsomeone will attempt to steal your personal data—it's a matter ofwhen. In fact, 47% of Americans were victims of financial identity theft in 2020.¹That'due south not okay! But there's a fashion you can protect your info and lower the take chances of strangers taking out credit in your proper name—by freezing your credit.

But like Mr. Freeze fromBatman, credit freezing tin stop your enemies (aka fraudsters) in their tracks and keep them from doing more harm. Here's what yous need to know nigh how to freeze your credit and then yous tin protect yourself and your loved ones from identity thieves.

What Is a Credit Freeze?

A credit freeze is a way to lower your take a chance of identity theft by locking others out of your credit report—recall of it as storing your valuables in a safe. Most creditors (the people who loan yous money) bank check your credit before letting you practice things like buy a house, lease a car, or take out a loan. By freezing your credit, you can stop creditors from approving new accounts—which helps prevent random people from opening up new lines of credit in your name (without you knowing).

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Of grade, if your credit is frozen, that meansy'all won't exist able to open up a new account either (similar to take out a mortgage). But you can always unfreeze your credit—or temporarily lift the freeze—whenever you lot want.

What happens when you lot freeze your credit?

Here's the deal: Freezing your credit is a smart movement. Non only does it keep someone'south greedy paws off your personal info, but it also gives y'all the command of who can run your credit report and when. But while freezing your credit is a good thing, at that place are some things y'all should know before diving in headfirst:

Freezing your credit doesnon guarantee a creditor won't nonetheless give a credit card to someone pretending to be you. At that place's always a run a risk they won't await up your credit showtime. But freezing your creditdoes lower the risk.
Someone can still try to hack into your existing accounts and get on a shopping spree with your difficult-earned money. Simply if someone does steal your identity, credit freezing can help stop them from opening new accounts and causing even more trouble.
Freezing your credit doesnotimpact your credit score—but if you lot've got whatever errors on your credit written report, you'll want to fix those before you decide to freeze your credit.
You—and your current creditors, debt collectors and some government agencies (like child support)—will still be able to see your credit written report. It just won't be available for any new lenders to see.
A credit freeze doesnot keep credit carte du jour companies and other businesses from trying to sell you lot preapproved credit offers based on your electric current credit info. (Junk mail service is the worst!)

How to Freeze Your Credit

Freezing your credit is a lot like doing the dishes. Information technology's not hard—information technology just takes some time . . . but not as much time as it would take to untangle the web of a stolen identity.

All yous have to do is contact the three major credit bureaus (Experian, Equifax and TransUnion) and let them know you want to freeze your credit. You can practise this through their websites, by post, or past calling them directly. If you adopt doing your business over the phone, y'all can contact each of the credit bureaus at the numbers below:

Experian: 888-397‑3742

Equifax: 888-378-4329

TransUnion: 888-909-8872

Make sure you have your personal data handy when placing your credit freeze (like your social security number, birth engagement and electric current address). They might ask you for proof of accost, your driver's license or a passport depending on how you decide to place your freeze.

Side by side, you'll fix a PIN that allows y'all to freeze and unfreeze your credit report whenever you want. And so, even if someone has your social security number or other personal information, they tin't affect your frozen credit without that Pin. (Then you really, really don't desire to lose it!)

It doesn't take long for the freeze to boot in—credit bureaus have to identify it inside i business solar day if you request information technology online or by phone, and within iii business days if you mailed in your request.

What Does It Cost?

Admittedly aught! You used to have to pay $3–12 to each credit bureau whenever you wanted to freeze or unfreeze your credit. But later on the corking Equifax data breach of 2017 (which leaked the personal information of 147 one thousand thousand Americans), the government decided to arrive easier and cheaper to protect your personal information.ⁱⁱ

So, now yous can freeze and unfreeze your credit for free! And don't forget that you lot can besides request a free credit report from each of the three major credit bureaus once a year, even if your credit is frozen.

When Should Y'all Freeze Your Credit?

Personal Data Breaches

We hear a lot about information breaches (recall Target or Uppercase Ane), but what exactly are they? A data breach is when someone gets their hands on private or sensitive information—like credit bill of fare or social security numbers—without permission. And since then many of united states store of import info like that online, there's a higher gamble people will be able to steal it.

Now, freezing your credit tin can't prevent someone from stealing your data, only it can end them from using it to open upnew lines of credit—and leasing a make-new Tesla in your proper name. Ouch! So, if y'all know there's been a breach of your personal business relationship or a breach in a company that stores your information, put your shields upwardly with a credit freeze.

Identity Theft

Identity theft is when someone uses your personal data (from a data alienation or fifty-fifty by digging through your mail service) to get into your accounts, open new accounts, or brand purchases usingyour money. Unfortunately, identity theft is pretty common these days. It tin be an absolute nightmare trying to clean up the mess someone else makes while pretending to be you lot.

That's why it's then of import to defend yourself from identity theft past doing things like checking your cybersecurity and changing your passwords. But the good news is that freezing your credit can go on identity thieves from going out and opening accounts in your name from hither to Timbuktu.

Protect Your Child's Credit

Sadly, fifty-fifty your kids aren't condom from identity theft. Just did you know you can freeze your kid'south credit to finish people from opening accounts in their proper noun too? Since y'all take to exist at least xviii years one-time to use credit, a credit agency volition have to open a credit file for your kid in society to freeze it.

It'due south super simple—all you take to practise is make full out a child credit freeze request form and mail it to each of the credit bureaus, forth with copies of important documents (like a birth certificate, social security card, etc.). If your child is 16 or older, they tin can do this themselves. You can likewise check your kid'south credit online for free to make sure they aren't already a victim of identity theft.

How to Unfreeze Your Credit

To unfreeze your credit, all you have to do is let the credit bureaus know you want to lift the freeze. Recollect that PIN we talked about earlier? You'll need to give that number to the folks at the credit agencies to unfreeze your written report. There's even an choice to lift the freeze temporarily if you want to apply for something that needs a credit cheque.

Continue in mind that it could take anywhere from several seconds to several days for your credit report to "thaw" and so creditors tin see it again. Yep, it's kind of a hurting to proceed contacting each credit bureau every time someone needs to see your credit report, merely information technology'southward less of a pain than having someone endeavour to take out a mortgage in your proper name.

Pro tip: If a potential employer needs your credit report because yous're applying for a job, you can always ask them which credit agency they'll check with so you lot don't have to contact all three.

Pros and Cons of Freezing Your Credit

Now that we've covered the basics, here'southward a wait at some of the pros and cons of freezing your credit:

Pros of Freezing Your Credit:

Identity thieves can't open new credit accounts in your name.
At that place are usually fewer cases of fraud if someone steals your identity.
Information technology'south costless to freeze or unfreeze your credit.
It doesn't touch your credit score.
You tin nevertheless see your credit report.

Cons of Freezing Your Credit:

It doesn't stop someone from stealing your personal data or hacking into an existing account.
Y'all accept to elevator the freeze if yous want to open up a new line of credit.
It could slow down any applications that require a credit check.
You lot have to keep track of a Pin number.

Now that we've covered the credit freezing basics, let'south accept a await at some other ways to protect your identity.

Credit Freeze vs Credit Lock: What's the Divergence?

Once the government put thegratis in creditfreeze, credit bureaus apace realized they weren't going to brand coin every fourth dimension someone decided to freeze or unfreeze their credit study. So, they came up with creditlocks. These are basically the same thing as credit freezes—except they're usually not gratuitous.

The only do good to a credit lock is that you tin can immediately freeze and unfreeze your credit with the affect of a push button on your phone. Only credit locks offer less legal protection considering they're not controlled past land constabulary like credit freezes are. Even if they seem more than user-friendly, credit locks are just a way for credit bureaus to try and make back the money they were getting before the 2017 data alienation—so you lot'd exist meliorate off sticking with a credit freeze.

Other Ways to Defend Confronting Identity Theft

Credit Monitoring

Even if you lot have a freeze on your credit and your cybersecurity seems to be as secure as Fort Knox, you still demand to check your credit and banking company statements regularly to make sure no one's trying to interruption in.

Credit monitoring services are great because they keep an center on your credit for you and alert y'all any time they discover something fishy going on. But while credit monitoring is important, it only makes you aware of a problem—it doesn't cease it from happening. So, you'll want to make certain y'all have other defenses in identify to gainsay identity theft.

Fraud Alerts

Let's say a credit monitoring service spots some strange action on ane of your accounts and you recall y'all might be a victim of identity theft. Or peradventure yous're worried it might happen considering your information is at take chances (like if someone stole of import documents or cards from you). If that happens, you can immediately identify a fraud alert. A fraud alert is similar to a credit freeze because information technology helps keep people from opening up new accounts in your name.

The main difference is that creditors tin still see your credit report—they but have to verify your identity kickoff. And when you contact ane of the credit bureaus about the fraud warning, they'll let the other two know (so yous don't take to).

The downside is that in that location's no penalisation for the credit agency if they choose to ignore a fraud warning and give a creditor your information anyway without confirming your identity first. (Seriously?) Plus, fraud alerts only terminal for up to a twelvemonth, then they aren't going to exist as effective as a credit freeze. But it doesn't injure to place a fraud alert as extra protection if you think someone has your personal info.

Identity Theft Protection

Identity theft tin rob you lot of more only coin or skilful credit. Police reports, phone calls, going through banking company statements—it can cost you countless hours and sleepless nights. But imagine having someone on your side who will do the work for you.

Identity theft protection is one of the best things you can become to save yourself the time and stress of trying to fight off cyber thieves by yourself. With Zander Insurance, you become a Certified Recovery Specialist who volition contact creditors on your behalf. They take the time to explain what happened and provide the necessary info so you tin can become your identity—and your life—dorsum. It'south too much of a risk to non take it—get identity theft protection today!

Cutting Credit From Your Life for Good

Let'south confront it: Our earth loves the "almighty credit score." But have you always thought about what a credit score really means? It's just a tool that measures how you handle debt. Yep. That's it. And when you think about information technology that way, it changes things. Go this: The credit manufacture wants to keep you lot in debt.

Doesn't that make y'all mad? Listen: We're not shy about how we feel virtually it. Debt is dumb (with a majuscule D), and you don't need information technology to alive your life. In fact, you can alive life without credit—or a credit score for that matter!

And i of the best ways to lower the take a chance of someone hacking into your credit accounts is past swearing off credit in the offset identify. When you don't borrow money, you lot can freeze your credit study—and let it stay frozen! (We're talkingdeep freeze here, folks.) But quitting credit does more than than just assist protect you from identity theft. Information technology frees you upwards to really start winning with coin!

Audio too proficient to exist truthful? Start a free trial of Ramsey+ and take control of your finances! You'll larn how to ditch credit for expert so you lot tin can focus on paying off your debt, saving for emergencies, and building wealth for the future.

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