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What’s a Credit Freeze and Why You Should Do It

With the recent security breach at Equifax, it’s a good time to think about how you can freeze your credit and why you should. A credit freeze is one of the best ways to protect yourself against identity theft. You don’t need to wait until there’s a large security breach and your information is at risk to do it; you can do it at any time to secure your identity.

When freezing your credit, be sure to do it with all three credit reporting agencies – Equifax, Experian, and TransUnion.

Let’s take a look at what a credit freeze does, when you probably shouldn’t do it, how to undo it.

What does a credit freeze do?

Basically, it allows you to lock your credit reports and create a personal ID number (PIN) that only you know to temporarily “thaw” your credit when applying for a legitimate credit service. This ensures that identity thieves can’t apply for credit in your name, using your information, and establish credit accounts that will later ding your credit rating.

The credit freeze has absolutely no impact on your existing lines of credit so you can continue to use them as you normally would. It only blocks new credit accounts from being established.

For many years, credit freezes have only been available to victims of identity theft, which can be too late. Now, most states have established laws allowing for credit freezes for anyone who resides in that state. All three credit reporting agencies allow you to freeze your credit for a small fee even if you haven’t been a victim of identity theft. This helps to protect you from becoming a victim.

Many states even allow you to freeze the credit of your minor children so identity thieves can’t steal their personal information and start racking up accounts in their names. The average cost is $3-$10 per person per credit bureau. Be sure to freeze your credit with all three reporting agencies.

Why you shouldn’t freeze your credit?

If you are applying for new credit accounts with various financial institutions regularly or your credit report is frequently accessed for your work, it’s not a good idea to freeze your credit. The continual fees to freeze and thaw your credit report would become excessive.

How do you thaw your credit after a freeze?

Thawing your credit usually includes a fee of up to $10 per agency. If you live in Kentucky, Pennsylvania, South Dakota, or Nebraska, the credit freeze will automatically fall off after 7 years and you will need to reinstate it.

Each of the three credit reporting agencies allow you to freeze and thaw your credit right online or by phone to make it easy and hassle-free. Use the links below to reach the credit freezing pages of each agency, set up your account login information, and get started.

Equifax

Experian

Transunion

If you feel you’ve been a victim of identity theft, or that you could be vulnerable to it, freeze your credit and request copies of your credit report from all three agencies. Look for any discrepancies in your accounts like balance and payments, then review the list of all companies that have requested your credit file. This is the best way to protect yourself from identity thieves.

About the author

Emilie Burke

Emilie is a politics-major turned data engineer. She graduated from Princeton University in 2015 and from Smartly with her MBA in 2016. She lives in North Carolina with her college sweetheart Casey who is currently stationed at Fort Bragg. She enjoys eating food, cuddling with her dog, and binge watching HGTV. She blogs at Burke Does. You can find her around the web at @emilielimaburke.

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