How to Freeze Your Credit and What it Does: An In-Depth Guide

Identity theft has reached epidemic proportions in the United States. According to 2021 statistics from the Federal Trade Commission, there were 1.4 million reports of identity fraud – that‘s a new victim every 2 seconds!

With fraudsters constantly finding new and sophisticated ways to steal personal and financial information, freezing your credit can provide an extra layer of protection against identity theft.

This comprehensive guide will walk you through everything you need to know about credit freezes: how they work, when you need them, as well as their benefits and potential drawbacks.

I‘ll also provide plenty of tips for preventing identity theft beyond just freezing your credit, so you can take a layered approach to protecting your good name and financial reputation. Let‘s dive in!

The Growing Threat of Identity Theft

Some key statistics really drive home how huge the identity theft problem has become:

• In 2021, total losses to fraud neared $6 billion, according to Javelin Research. The average loss per identity theft victim was $1,738.

• Credit card fraud made up 29% of all identity theft reports in 2021, per the Federal Trade Commission. This type of fraud saw a 19% increase from 2020 to 2021.

• Data breaches increased 68% from 2020 to 2021, exposing the personal information of billions of people worldwide, according to RiskBased Security. Massive breaches like Equifax, Yahoo, and Marriott put millions at risk.

• Children are tempting targets for identity thieves – around 1 million minors were victims of identity theft or fraud in 2020, reports Javelin Research. Child identity theft often goes undetected for years.

Beyond just credit card fraud, identity thieves can also use your information for medical identity theft, criminal impersonation, tax fraud, opening utilities in your name, and more. No single tool can prevent all types of identity theft.

But freezing your credit is an excellent line of defense specifically against new account identity theft – when fraudsters open loans or credit cards with banks and lenders using your stolen personal information.

What Exactly Does a Credit Freeze Do?

A credit freeze locks down access to your credit report and stops lenders from being able to check your credit. Most lenders will not open new accounts without first checking your credit history. So if they can’t access your report, they cannot extend new credit.

Here is a bit more about how credit freezes work:

• Freezing your credit involves contacting Equifax, Experian and Transunion individually to restrict access to your credit reports at each bureau.

• Once requested, a freeze goes into effect within 24 hours and usually much quicker than that. You‘re provided a unique PIN code to lift the freeze when needed.

• Freezes must be lifted before lenders can check your credit. You can lift temporarily or permanently. A temporary lift can be for a specified timeframe – a day, a week, etc.

• Freezing does not affect your credit score or history in any way. Current creditors can still access your credit reports. Only NEW credit checks are blocked.

• Likewise, any existing credit cards, loans, mortgages stay fully active as usual. Freezes only stop brand new accounts.

So in essence, credit freezes seal up your credit reports from unauthorized access. This can halt identity thieves trying to obtain new credit in your name, limiting the financial damage.

Step-by-Step Guide to Freezing Your Credit

Placing a credit freeze is quick, easy, and free if you do it yourself through the credit bureaus’ websites or via phone:

Request Your Freeze Online

Equifax

1. Go to Equifax.com/personal/credit-report-services

2. Click “Freeze Your Equifax Credit File”

3. Create an account with your personal info and unique PIN

4. Click “Freeze My Equifax Credit File” and follow prompts

Experian

1. Go to Experian.com/ncaconline/freeze

2. Provide personal info and create an account

3. Choose whether you want a free or paid freeze option

4. Check your email for a confirmation notice

TransUnion

1. Go to TransUnion.com and enter your info to create an account

2. From account homepage select “Security Freeze” option

3. Follow the instructions to submit your freeze request

Request By Phone

You can also call each bureau to place your freeze request over the phone:

• Equifax – 1-800-685-1111

• Experian – 1-888-397-3742

• TransUnion – 1-888-909-8872

No matter which method you use, the credit bureaus will provide a unique PIN once the freeze is in effect. Keep your PIN very safe – you‘ll need it to lift the freeze!

What Information You’ll Need to Provide

To request a freeze, each credit bureau will ask for:

• Full legal name

• Social Security Number

• Complete current address

• Previous addresses for past 2 years

• Date of birth

• Valid government-issued ID (driver’s license, state ID, passport, etc)

• Possible challenge questions to confirm identity

Having this information ready will make the process much smoother.

When Should You Freeze Your Credit?

Anyone can request a credit freeze, but they are most critical in these situations:

If You’re a Victim of Identity Theft

If you discover unauthorized charges on your existing accounts, are contacted by debt collectors about loans you never took out, receive medical bills for treatment you didn’t receive – these are all signs your identity has likely been stolen.

Immediately freeze your credit to prevent further damage. And report the identity theft to the FTC at IdentityTheft.gov.

After a Major Data Breach

If your personal info was compromised in a breach like Equifax or T-Mobile, there is now a risk of identity thieves accessing it. Consider proactively freezing your credit to be safe.

You Lost Your Wallet or Important Documents

Cancel all credit cards immediately if your wallet is lost or stolen. And if it contained your Social Security card, birth certificate or passport, strongly consider freezing your credit as a precaution.

You See Suspicious Activity on Your Credit Report

Finding accounts you don’t recognize on your credit report is a huge red flag for identity theft. Freeze your credit to stop further unauthorized accounts.

You Want to Prevent Identity Theft

Some people freeze their credit as a preventive measure against identity theft. While not a 100% guarantee, it does make it much harder for thieves to succeed if your data is compromised.

For Children

Children‘s identities are attractive targets since the theft can go undetected for years. Freezing your minor child‘s credit can prevent criminals from using your child‘s Social Security number and information.

Pros and Cons: Should You Freeze Your Credit?

Freezing your credit has several benefits but also some drawbacks to consider:

Pros

• It’s totally free and easy to do yourself!

• Prevents thieves from opening most new fraudulent accounts

• Protects you after a breach compromises your data

• No negative impact to your credit score or history

• Stays locked down until YOU choose to lift the freeze

Cons

• Doesn’t prevent unauthorized charges on EXISTING accounts

• Must contact each of the three bureaus separately

• Extra steps when legitimately applying for new credit

• Fewer options for credit monitoring services

• Can create delays for loans, credit cards, utilities, etc.

• Not a foolproof way to eliminate all identity theft risk

The bottom line is that credit freezes are a powerful deterrent against fraudsters, but NOT an absolute guarantee of protection. Think of them as one key layer in your identity theft prevention plan.

What About Fraud Alerts vs. Credit Freezes?

Wondering whether a fraud alert might work better for your situation? Here’s how they compare:

Fraud Alert

• Free to place and remove

• Only need to contact 1 bureau

• Other 2 bureaus notified automatically

• No credit checks without notification to you first

• Initial alert lasts 90 days

• Extended alert lasts 7 years

• Does NOT prevent credit checks

• Does NOT block any new accounts

Credit Freeze

• Also free and easy to enact

• Must contact each bureau separately

• Stops ALL new credit checks while frozen

• Must lift freeze to allow new credit

• Remains on indefinitely until you lift

• Prevents new fraudulent accounts

So fraud alerts add scrutiny to applications, while freezes block new credit checks completely. Choose based on your specific concerns and needs.

And you can use both! Get alerts AND freeze for maximum protection.

When Do You Need to Lift a Credit Freeze?

• Applying for a mortgage or auto loan
• Getting a new rewards credit card
• Signing up for utilities like electricity, gas, cable/internet
• Starting a new job – some employers check credit
• Renting an apartment – landlords often review credit history
• Enrolling in credit monitoring services
• Taking out a personal loan or student loans
• Creating accounts with banks, investment firms, insurance providers

Anytime you need to authorize someone to check your credit, you‘ll have to lift the freeze either permanently or temporarily. You can usually lift a freeze within an hour at each bureau‘s website.

When applying for a big loan like a mortgage, ask the lender which credit bureau they use. You can save time by only lifting the freeze at that particular bureau.

And don‘t forget to re-freeze your credit after new accounts are open! Leaving it unlocked leaves you vulnerable.

State-Level Laws On Credit Freezes

While credit freeze laws at the federal level provide baseline protections, some states expand freeze rights even further. For example:

• Faster Timing – In IN, MA, and SC, bureaus must enact a freeze within 15 minutes if requested online or by phone.

• Additional Freezes – CA, CO, and IL let you request a freeze for children under 16. Some states allow freezes for incapacitated adults with guardians.

• Protection for Minors – Many states make it illegal for creditors to run credit checks on minors. CA, DE, and KY fine creditors who improperly access a child’s credit report.

So make sure you understand your specific rights based on the state where you reside. Search “[Your State] credit freeze laws” for details. State Attorney General offices also provide guidance.

Managing Credit Freezes With Ease

I know juggling freeze PIN codes and unlocking your credit on demand can sound daunting. But millions of consumers manage frozen credit seamlessly. Here are my tips:

• Store PINs securely – Keep your unique PIN for each bureau in a safe place like a password manager or locked safe. Never store pins on your phone or computer!

• Lift several days ahead – When applying for credit, lift the freezes at least 2-3 days in advance to avoid delays. Re-lock as soon as approved.

• Freeze with a freeze – Parents can freeze their own credit as an added precaution while their child’s credit is frozen until adulthood.

• Freeze / unfreeze online – Use each bureau‘s website to instantly enact and lift freezes – much faster than calling!

• Sync lifts & freezes – When lifting for credit application, lift the freeze at all 3 bureaus at the same time for convenience.

• Use a calendar – Mark your calendar ahead of time with reminders to lift and re-freeze by certain dates when applying for credit.

It may take a bit of organization, but soon managing credit freezes will be seamless for you. Just create a system to stay on top of it.

Going Beyond Freezes: Identity Theft Prevention Tips

To truly protect yourself, think of freezes as just one piece of your identity theft prevention plan. You’ll also want to:

🔒 Use password managers and enable two-factor authentication on accounts

🔒 Check your credit reports annually and review all statements for unauthorized activity

🔒 Only access sensitive accounts on personal, password-protected devices that are kept updated

🔒 Avoid oversharing personal information online or on social media

🔒 Carefully review privacy policies before downloading apps or creating new online accounts

🔒 Shred documents with personal information before disposal

🔒 Wipe devices before selling them and destroy old hard drives

🔒 Keep security software up-to-date on computers and mobile devices

🔒 Use secure internet connections only when accessing financial accounts

🔒 Question unsolicited contacts asking for your personal data

🔒 Never click suspicious links in emails, texts or online advertising

Caution and vigilance go a long way! And freezing your credit provides an additional barrier against new account identity theft.

Credit Freezes: Conclusion and Next Steps

I hope this guide has helped explain everything you need to know about freezing your credit – what it really does, how to freeze/unfreeze, when it helps most, and how it fits into your larger identity theft protection strategy.

Freezes take a bit more time and planning, but are one of the most powerful tools for stopping new account fraud in your name. If you have any other credit freeze questions, feel free to reach out!

Ready to get started securing your credit? Here are your next steps:

1️⃣ Gather documents like Social Security card, passport, proof of address to have on hand

2️⃣ Contact Equifax, Experian and TransUnion to place your credit freezes

3️⃣ Store your unique PIN codes in a secure place to lift freezes when needed

4️⃣ Put a calendar reminder to check your credit reports quarterly

5️⃣ Enable two-factor identification on accounts whenever possible

Taking these proactive measures can help protect you from the major hassles of identity theft. Don‘t wait until you‘re a victim – freeze your credit and take control of personal data security now.