Credit Freeze

Written by Joel Cornilsen, Leighton State Bank’s COO

Data breaches have become somewhat of the norm in our daily newsfeeds. After the Equifax breach that impacted 143 million Americans, some experts are recommending that we “freeze” our credit.

Below are some helpful steps that you should follow when considering freezing your credit.

  1. Understand what a credit freeze is

When you freeze your credit report, you are stopping any of your personal data from being reported to lenders and creditors. Thus, in the event that a fraudster would try to use your Social Security number to apply for a credit card, that application would be rejected, as the lender or creditor would be unable to verify your credit score.

  1. Understand the process

The path to a credit freeze involves informing all three major credit bureaus. Go to the credit bureau websites individually and locate the security freeze link. The credit bureau website links are listed below for your convenience.

Equifax: www.equifax.com/personal/credit-report-services/
Experian: www.experian.com/freeze
TransUnion: www.transunion.com/credit-freeze

  1. It’s Free!

There is no longer a cost to freeze or unfreeze your credit report. Credit freezes are now free in all states, for both placing the initial credit freeze as well as “thawing” or lifting the credit freeze, either temporarily or permanently.

  1. A Freeze doesn’t protect Everything

A credit freeze only prevents new credit from being obtained by a fraudster using your personal information. If your existing credit card number is obtained by a fraudster the credit freeze you have put in place won’t help.

  1. Delays are possible with a Freeze

Credit freezes can create delays and confusion when credit is needed quickly. Another alternative to a credit freeze may be to sign up for a fraud alert. Fraud alerts put a warning on a consumer’s credit report, but it does not freeze it. The alert is for lenders and creditors to verify the identity of anyone trying to open an account in a consumer’s name.

  1. Stay Attentive

If you do implement the credit freeze, continue to check your financial statements regularly. Another good practice is to update your passwords if you suspect any of your information has been exposed by a breach. It is recommended to not use the same password for all of your financial websites. While this can be an inconvenience for us as the consumer it is a best practice to protect ourselves against the fraudsters.

A credit freeze could be a good option for you if you’re involved in a data breach. Just understand the pros and cons of freezing your credit report before you implement it.

 

Sign Up For Our E-Newsletter