Credit Freeze
What Is a Credit Freeze?
A credit freeze, also known as a security freeze, is a tool that restricts access to a consumer’s credit report. When a credit freeze is in place, lenders and creditors cannot view the credit report without the consumer’s permission, making it difficult for criminals to open new accounts using stolen personal information.
Credit freezes are commonly used to prevent identity theft and unauthorized credit activity.
Why It Matters
If someone steals your personal information, they may attempt to open loans or credit cards in your name. A credit freeze prevents most lenders from accessing your credit report, which blocks the approval of new credit applications.
Because of this, a credit freeze is one of the most effective tools for preventing identity theft.
When to Use a Credit Freeze
A credit freeze is recommended if:
- You are a victim of identity theft.
- Your data was exposed in a breach.
- You want proactive protection.
How Credit Freezes Work
Consumers can request a credit freeze through each of the major credit bureaus.
You must contact each credit bureau individually:
- Equifax: Place, Temporarily Lift or Permanently Remove a Security Freeze, 800-525-6285
- Experian: Security Freeze, 888-397-3742
- TransUnion: Manage a State Security Freeze Online, 800-680-7289
Once activated:
- lenders cannot access the credit report
- new credit accounts cannot be approved
- existing accounts remain unaffected
Consumers can temporarily lift or remove the freeze when they apply for credit.
Example
After a major data breach exposes personal information, a consumer places a credit freeze with the credit bureaus to prevent fraudulent credit applications.
Credit Freeze vs Fraud Alert
- A credit freeze blocks access to the credit report.
- A fraud alert allows access but warns lenders to verify identity before issuing credit.
FAQs About Credit Freezes
Do credit freezes affect credit scores?
No. A credit freeze does not affect credit scores.
Are credit freezes free?
Yes. Credit bureaus must provide them at no cost.
Can consumers still use existing credit accounts?
Yes. A credit freeze only affects new credit applications.
Related Terms
How to Remove a Credit Freeze
To lift or remove a credit freeze temporarily or permanently, you’ll typically need to contact the credit reporting agencies again and provide your PIN or password. Each agency may have its own process for managing freezes, so following their specific instructions is essential.
