Now You Can Freeze Your Credit File for Free

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Now You Can Freeze Your Credit File for Free

Data breaches and identity theft are not to be taken lightly. According to Javelin Strategy & Research, identity fraud reached an all-time high in 2017, with 16.7 million victims in the United States. The number of reported data breaches has also reached a new high, with 1,579 documented breaches impacting roughly 179 million personal and financial details.

One approach to possibly prevent identity thieves from acquiring your information is to freeze your credit report. A credit freeze prevents current creditors’ access to your credit and may only be removed at your request, making it more difficult for someone to establish credit in your name falsely.

You may now freeze your credit, preserving your personal and financial information, owing to federal law that went into effect on September 21, 2018 (named the Economic Growth, Regulatory Relief, and Consumer ProtectionAct).

The bill also increases the duration of a fraud notice on your file from 90 days to one year.

Credit Freezes vs. Monitoring

“Think of a credit freeze as a cutting-edge home security system that keeps the bad guys out, as opposed to credit monitoring, which is more like that text message you got from a neighbor after someone smashed through your living room window and stole your big-screen TV,” says CreditCards.com industry analyst Ted Rossman. “In the latter situation, the harm has already been done, thus the warning isn’t really useful.”

Following the Equifax (EFX) data hack in September 2017, one in every five Americans chose to freeze their credit, resulting in credit freeze fines totaling $1.4 billion.

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“Previously, a credit freeze or security freeze cost $3 to $10 per credit bureau,” Ashley Dull, editor in chief of CardRates.com, says. “It might cost up to $30 to freeze your credit with all three agencies, with further expenses to unfreeze your credit.”

Fees for freezing or unfreezing credit reports were formerly set at the state level. The new legislation, known as the Economic Growth, Regulatory Relief, and Consumer Protection Act, eliminates the fee requirement at all three main credit bureaus—Equifax, Experian, and TransUnion—across the country. Consumers may also “thaw” their data for free, either temporarily or permanently.

What’s Changing for Credit Freezes

“This law is a step in the right way for securing customers’ identities,” says Dale Dabbs, president and CEO of Sontiq, EZShield + IdentityForce’s parent business. “It’s vital to have open access to your credit reports while also deciding who may see your credit information.”

The legislation also allows parents to freeze their children’s credit records for free if they are 16 or younger. Identity theft in children may be readily ignored if parents do not seek for warning signals.

“If you’re not diligent about your own credit, chances are you’re not thinking about someone taking your toddler’s identity and piling up false charges,” says Rossman. “This might possibly go undiscovered for many years until they mature and ask for credit, only to discover a huge problem.”

In 2017, almost one million children were victims of identity theft, costing their families $540 million in out-of-pocket expenses. Sixty percent of children who were victims of identity theft were targeted by someone they knew.

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“These instances are a strong reason to freeze your children’s credit history,” Dull adds, “keeping their information secure with no fee to unlock it when they’re old enough to start using credit.”

How to Freeze Your Credit for Free

To freeze your credit file for free, just call each of the three credit agencies and request a freeze. You may freeze your credit with all three bureaus online:

  • Equifax: http://www.Equifax.com/personal/credit-report-services
  • Visit www.Experian.com/freeze for more information.
  • Visit www.TransUnion.com/credit-freeze for more information.

You can also initiate a freeze by phone.

You must supply your name, Social Security number, date of birth, address, and phone number when you want to freeze your credit. If you want to freeze your report online, you will be prompted to establish an account using your email address and a unique password. You just need to authenticate your identification after that, and you’re done.

You’ll have to submit another request to unfreeze your credit after it’s been locked, but it won’t cost you anything. Just keep the time in mind while unfreezing your credit file.

According to Rossman, the new rule requires credit freezes to be released within an hour, but he suggests leaving yourself a longer window if you intend to apply for credit shortly after. If you’re looking for a vehicle, for example, he recommends removing a freeze three business days before applying for a loan to avoid getting stuck in limbo while waiting for financing to be authorized since your credit information is unavailable.

Another point to notice is that the new rule extends short-term fraud warnings from 90 days to one year. When a fraud warning is placed on your credit report, lenders are required to contact you to verify your identity when they receive an application for credit in your name.

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The Bottom Line

While free credit freezes aren’t a flawless barrier against identity theft, they may help keep your information out of the hands of those who shouldn’t have it. You may further fortify your defenses by monitoring your credit report on a regular basis, scrutinizing bank and credit card statements for unusual activity, and setting up bank and credit card alerts to warn you of new transactions. The more proactive you are in protecting your information, the better your chances of avoiding identity theft.

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