Helpful Home Tips &
Mortgage Advice from Experts

Back to Posts
Hundred dollar bill with cracks in it

What is a Credit Security Freeze?

If your personal information was compromised in a data breach, you will want to take certain steps to prevent the thieves from damaging your credit and financial wellbeing. If the information compromised included the things necessary to apply for a line of credit, utilities, or a loan of any kind, you can protect yourself by placing a credit security freeze on your credit reports.


What is a credit security freeze?

A credit security freeze is a special flag placed on your credit reports that requires you to verify information before any type of credit report can be processed for a potential creditor. It makes it extremely difficult if not impossible for an identity thief to open accounts in your name.


How will a credit security freeze affect me?

Placing a credit security freeze on your credit bureau reports will mean that you will have to take advance measures when you want to apply for credit. This means that when you wish to buy a new car, open a new credit card account, get a new cell phone company, purchase a home, or even open a new utility account, you will need to call the credit bureaus in advance to temporarily lift the credit security freeze. There may be fees associated with this, and the timeline required to lift the freeze temporarily varies by credit bureau.

The credit security freeze will stay in place on your report until you choose to have it removed.  If your personal information was stolen or compromised, it might be wise to leave the freeze in place for a year or more or until you know your information is secure again.

A credit security freeze may also affect your employment if you hold a professional license that requires you maintain satisfactory credit terms, such as many of those in the financial field. Check with your employer before placing a credit security freeze on your credit if you think it might affect a professional license that you hold.


Other things to know about credit security freezes

A credit security freeze will not affect your credit scores in any way, nor will it affect your current creditors or collection agencies from reporting your accounts to the major credit bureaus. The freeze will also not stop you from receiving “pre-screened” credit offers of credit in the mail.


How to initiate a credit security freeze

To initiate a credit security freeze, you will need to contact each credit reporting bureau separately. The three major credit bureaus including TransUnion (1-888-909-8872), Experian (1-888-397-3742), and Equifax (1-800-349-9960).

You will need to supply the bureaus with your name, address, birthdate, Social Security number, and other important personal information. According to the Federal Trade Commission, you will be required to create a secret PIN for each bureau that will act as a password for the freeze. In order to lift the freeze, either permanently or temporarily, you will need to provide the credit bureau with your secret PIN.


Credit security freeze alternatives

If you want to take a less invasive approach to protecting your credit from fraud, you can choose instead to have fraud alerts placed on your credit reports. Fraud alerts provide a degree of protection below a full credit security freeze, but they will help you to protect your credit integrity.

In most cases, a fraud alert will mean that you will need to verify personal information or prove your identity in order to open a new credit account. Like a freeze, you can choose to remove a fraud alert from your credit report at any time.

If you are unsure whether you would like a credit security freeze or a fraud alert, contact the credit reporting agencies for more information.