Home > Identity Theft > 5 Signs You Should Freeze Your Credit

Comments 0 Comments

Roughly 13 million consumers are victims of identity theft each year, and millions more experience data breaches, phishing attempts and other types of financial fraud. If you are among them — or are worried you may be next — you may have thought about blocking access to your credit reports completely. That’s essentially what a credit freeze does, and there are times when it makes sense to take that step. Here are five of them. 

1. You Can’t Stop a Scammer 

If your identity is being used to get credit in your name and your efforts to stop it (for example, with a fraud alert) have failed, you may want to consider a security freeze. “We typically recommend placing a freeze in circumstances when the victim has severe identity theft or multiple forms of it,” says Brett Montgomery, fraud operations manager for Identity Theft 911. In less severe cases, a fraud alert, which tells companies accessing your credit to verify your identity, is often recommended.

2. Your Ex Can’t Be Trusted 

Whether you’ve escaped an abusive relationship or you worry that your ex may try to use your good credit to get more credit (or to get back at you), a credit freeze may help protect your information. “Freezing the file may help prevent attempts at credit fraud by a vindictive spouse,” Rod Griffin, director of public education for Experian. Unfortunately, victims of domestic violence aren’t always ensured a free credit freeze, though New York citizens can get one as long as they can provide an order of protection, a domestic violence incident report, a police report or a signed affidavit from a service provider. If you are not entitled to a security freeze at no charge, you’ll have to weigh the cost against the peace of mind it may bring you (and your ability to pay to place or lift the freeze as needed).

3. Your Kid Is a Target 

I’ve written before about the fact that my teenage daughter has had her personal information, including her Social Security number, compromised twice already. If you’re in the same boat and your child’s information has been compromised, you may wonder whether you should lock down your kid’s credit. Maybe. But before you do, you may want to check whether they have a credit file. If there’s no file, there is nothing to freeze. (In some situations, you can create a report to freeze, says Griffin, but he’s not sure that’s always the best option.) 

4. You’re Done With Credit 

If you are truly, absolutely done with credit, freezing your credit file may be an option.  “We would also recommend a freeze to someone of an older age that does not need credit or has no intentions in establishing credit anymore because they are financially set in life,” says Montgomery. Just keep in mind that your credit information is used for more than just loans. A credit check may be required to get utility or cell phone service, for example, or if you shop for cheaper auto or homeowner insurance. Each time that happens you’ll need to lift the freeze, and sometimes that means lifting it with all three credit reporting agencies.

5. You’re Leaving the Country for an Extended Time 

Planning a trip around the world? Retiring in a cheaper locale overseas? You may want to consider freezing your file so you don’t have to worry about the risk of identity theft while you are away from the U.S. A cheaper option, though not quite as secure, would be to place a fraud alert instead. (Note that servicemembers may place a free active duty alert on their credit files when they deploy. It will last for one year.)

Before You Freeze 

Here are some important things to know about credit freezes: 

  1. When you place a freeze, you will get a personal identification number (PIN) you must use to lift the freeze when you want to shop for a loan or give a company access to your file. If you place one with each of the three different bureaus you will have three PINs to remember.
  2. You will generally have to pay a fee to initiate a freeze, and pay a fee each time you want to lift it unless you qualify for a free freeze. You typically must be a victim of identity theft (and have proof with a police report or something similar) or be over a certain age (for example, over age 65) to qualify for this service at no charge. Consumer’s Union publishes a list of state credit freeze laws.
  3. Freezing your credit reports does not prevent all access to your information.  “You can access your own file through AnnualCreditReport.com and you can monitor your own credit scores,” says Griffin. In addition, your current creditors and companies with which you have a current relationship may still access your credit. A freeze doesn’t prevent a credit score from being calculated, but it will prevent a company you don’t already have a relationship with from obtaining your credit scores.
  4. Use the following links to place one: Equifax.comExperian.com; and TransUnion.com.

Whether or not you decide to lock down your credit information, getting your free credit reports each year and then monitoring your credit scores on a regular basis (which you can do for free every month with Credit.com’s free credit report summary) can help you spot fraud faster, and hopefully stop the perpetrator before too much damage is done.

More From Credit.com:

Image: iStock

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

Certain credit cards and other financial products mentioned in this and other articles on Credit.com News & Advice may also be offered through Credit.com product pages, and Credit.com will be compensated if our users apply for and ultimately sign up for any of these cards or products. However, this relationship does not result in any preferential editorial treatment.

Hello, Reader!

Thanks for checking out Credit.com. We hope you find the site and the journalism we produce useful. We wanted to take some time to tell you a bit about ourselves.

Our People

The Credit.com editorial team is staffed by a team of editors and reporters, each with many years of financial reporting experience. We’ve worked for places like the New York Times, American Banker, Frontline, TheStreet.com, Business Insider, ABC News, NBC News, CNBC and many others. We also employ a few freelancers and more than 50 contributors (these are typically subject matter experts from the worlds of finance, academia, politics, business and elsewhere).

Our Reporting

We take great pains to ensure that the articles, video and graphics you see on Credit.com are thoroughly reported and fact-checked. Each story is read by two separate editors, and we adhere to the highest editorial standards. We’re not perfect, however, and if you see something that you think is wrong, please email us at editorial team [at] credit [dot] com,

The Credit.com editorial team is committed to providing our readers and viewers with sound, well-reported and understandable information designed to inform and empower. We won’t tell you what to do. We will, however, do our best to explain the consequences of various actions, thereby arming you with the information you need to make decisions that are in your best interests. We also write about things relating to money and finance we think are interesting and want to share.

In addition to appearing on Credit.com, our articles are syndicated to dozens of other news sites. We have more than 100 partners, including MSN, ABC News, CBS News, Yahoo, Marketwatch, Scripps, Money Magazine and many others. This network operates similarly to the Associated Press or Reuters, except we focus almost exclusively on issues relating to personal finance. These are not advertorial or paid placements, rather we provide these articles to our partners in most cases for free. These relationships create more awareness of Credit.com in general and they result in more traffic to us as well.

Our Business Model

Credit.com’s journalism is largely supported by an e-commerce business model. Rather than rely on revenue from display ad impressions, Credit.com maintains a financial marketplace separate from its editorial pages. When someone navigates to those pages, and applies for a credit card, for example, Credit.com will get paid what is essentially a finder’s fee if that person ends up getting the card. That doesn’t mean, however, that our editorial decisions are informed by the products available in our marketplace. The editorial team chooses what to write about and how to write about it independently of the decisions and priorities of the business side of the company. In fact, we maintain a strict and important firewall between the editorial and business departments. Our mission as journalists is to serve the reader, not the advertiser. In that sense, we are no different from any other news organization that is supported by ad revenue.

Visitors to Credit.com are also able to register for a free Credit.com account, which gives them access to a tool called The Credit Report Card. This tool provides users with two free credit scores and a breakdown of the information in their Experian credit report, updated twice monthly. Again, this tool is entirely free, and we mention that frequently in our articles, because we think that it’s a good thing for users to have access to data like this. Separate from its educational value, there is also a business angle to the Credit Report Card. Registered users can be matched with products and services for which they are most likely to qualify. In other words, if you register and you find that your credit is less than stellar, Credit.com won’t recommend a high-end platinum credit card that requires an excellent credit score You’d likely get rejected, and that’s no good for you or Credit.com. You’d be no closer to getting a product you need, there’d be a wasted inquiry on your credit report, and Credit.com wouldn’t get paid. These are essentially what are commonly referred to as "targeted ads" in the world of the Internet. Despite all of this, however, even if you never apply for any product, the Credit Report Card will remain free, and none of this will impact how the editorial team reports on credit and credit scores.

Our Owners

Credit.com is owned by Progrexion Holdings Inc. which is the owner and administrator of a number of business related to credit and credit repair, including CreditRepair.com, and eFolks. In addition, Progrexion also provides services to Lexington Law Firm as a third party provider. Despite being owned by Progrexion, it is not the role of the Credit.com editorial team to advocate the use of the company’s other services. In articles, reporters may mention credit repair as an option, for example, but we’ll also be sure to note the various alternatives to that service. Furthermore, you may see ads for credit repair services on Credit.com, but the editorial team isn’t responsible for the creation or implementation of those ads, anymore than reporters for the New York Times or Washington Post are responsible for the ads on their sites.

Your Stories

Lastly, much of what we do is informed by our own experiences as well as the experiences of our readers. We want to tell your stories if you’re interested in sharing them. Please email us at story ideas [at] credit [dot] com with ideas or visit us on Facebook or Twitter.

Thanks for stopping by.

- The Credit.com Editorial Team