The Benefits of Freezing Your Credit

Requesting that the credit bureaus freeze your credit has become one of the ways consumers are protecting themselves from identity theft. When a credit report freeze is done, the file becomes inaccessible from all unauthorized views. All new inquiries will be blocked and only the owner of the report can request for the freeze to be lifted. Once it has been lifted, only the specified company will be able to access the report. Furthermore, the consumer can decide how long the credit report  can stay open to new inquiries.  There are many benefits to freezing your credit.  Read on to learn more.

Applying For A New Line Of Credit

What if you want to apply for a new account? Before submitting application to your chosen lender, you need to request for the freeze to be lifted. Lifting or thawing can take only a few minutes to a few days depending on the credit bureau. As mentioned above, you can specify the company that will be given access to your report and for how long you want your account to be accessible.  Most credit bureaus allow you to unfreeze your credit once a year for free.  But after that its a nominal fee.

Is a credit freeze the same as fraud alert?

If you suspect someone is trying to steal your identity, or you notice something strange, like your someone has been going thru your mail.  You can call the credit reporting agencies to request they put a fraud alert on your credit report.  When you have a fraud alert on your credit report , creditors are supposed to notify you if someone tries to open a new account under your name. However, some creditors may ignore the alert and approve a new application without first notifying the owner of the credit report.

Unlike a fraud alert, a credit freeze is more restrictive. You can request for a fraud alert simply by calling the credit bureaus but if you want to request for credit freeze, you must send a letter through a registered post mail with at least 2 copies of proof of residency or identification. There is also a charge of $10 to $12 for each credit bureau.

Once your credit report  has been frozen, it will stay frozen for an unlimited time unless a request for a lift has been made. Take note that there is also a a fee of $10 to $12 for lifting and you will be required to provide the PIN code that you were given when your account has been frozen.

Despite the fees and minor inconveniences, placing your credit freeze on your credit report is a great way to protect yourself from ID theft and fraud. It prevents identity thieves and scammers from committing crimes such as opening a new account using other people’s identity.

Without access to the report, a creditor will not be able to grant approval to a new application. In addition, identity thieves will not be able to take a look into your credit file without first obtaining your pin, and then having to pay to unfreeze it.  Most thieves will move on, what if your credit is bad?  They would have gone thru a lot of trouble for nothing!  So most ID thieves will move on to another victim when they realize there is a credit freeze on your account.

About the Author:

Suzy Vanstrusen is a credit analyst and a writer on the website EZCreditRepairSolutions.com. She has been providing consumers with tips and wise information about credit repair as well as helping you out more with your bad credit loans.  Copyright © 2010

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