When You Should Consider Freezing Your Credit Report

by Hank Coleman

Consider Freezing Your Credit ReportWhen should you consider freezing your credit report? Your credit score is one of the keys to your finances. Companies use it to determine what interest you will pay, if you are even qualified for a loan, use it to make hiring decisions, and even use it in determining how much your car insurance premium will be.

Certain events could make you want to take action freezing your credit report like being the victim of identity theft. Here is a step-by-step way to freeze your credit score to help you protect it.

Why Freeze Your Credit Report

Freezing your credit score is not a decision you should take lightly. If you believe your identity could have been stolen, you should consider a credit freeze to help you protect your credit score from further damage. When you freezing your credit report, you prevent others from accessing your credit, opening new accounts, taking out loans, and taking other actions that can harm your credit score.

What Is A Credit Freeze?

When you freezing your credit report, you will prevent changes to your credit report and affecting your credit score. A credit freeze can even delay basic actions such as credit inquires that you start or new lines of credit that you request.

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That is why you should only freeze your credit report if you need to (although you can get a pin so you can personally access your scores if you need to). However, because of this credit freeze, criminals will not be able to open new accounts using your information because your credit reports will be locked preventing new credit from being established in your name.

How To Freeze Your Credit Report

Here is how to freeze your credit report. Every state has different requirements for freezing your credit. Currently forty-seven states and the District of Columbia have credit freeze laws in effect.

However, the three main credit bureaus (TransUnion, Equifax, and Experian) offer a credit freeze voluntarily to victims of identity theft at their request. In order to effectively prevent access to your accounts, you do need to request a security freeze at all three credit bureaus.

While it varies from state to state, here are some basics you must provide. You must provide sufficient information to verify your identity including name, Social Security number, address, current and previous addresses, date of birth, at least one government issued ID, and one copy of a utility bill that shows your name and address.

There may be a fee to freeze your credit report, but it varies from state to state and is usually free for victims of identity theft. To show you are a victim of identity theft, you must usually submit a valid incident or investigation report from your local law enforcement agency. Make sure that you check your state’s laws for more specifics.

Have you ever had to freezing your credit report? What made you need to go that route?

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About Hank Coleman

Hank Coleman is the founder of Money Q&A, an Iraq combat veteran, a Dr. Pepper addict, and a self-proclaimed investing junkie. He has written extensively for many nationally known financial websites and publications. Hank holds a Master’s Degree in Finance and a graduate certificate in personal financial planning. Email him directly at Hank[at]MoneyQandA.com.

Hank Coleman has written 581 articles on Money Q&A. Learn more about Money Q&A on Twitter @MoneyQandA and @HankColeman.

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{ 4 comments… read them below or add one }

John S @ Frugal Rules

Nice post. A good friend of mine had to do this a few years ago because his car had been stolen and the people ended up stealing his identity. It can be a hassle, but definitely worthwhile to further protect yourself.


Money Beagle

I’ve never had an issue so we have never really looked into this. Always something to think of though. Too bad people have to be so dishonest.


Dominique Brown

There are a few drawbacks in freezing your credit, but if you’re not using credit or getting credit in the future those drawbacks are worth it.


Adam Hathaway

Is there any other logical reason to freeze your credit report other than the potential it was compromised?


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