What you need to know before freezing your credit
Over 143 million Americans had their sensitive personal information exposed to hackers in the recent Equifax data breach. There’s a good chance that you or someone in your household may have been impacted by this historically huge data hack.
The bad news: your information is probably already in the hands of hackers that can use that information in identity theft schemes. The good news: you can take steps to protect yourself to minimize what hackers can do with your information. One option that you may want to consider is a credit freeze.
What does it mean to “freeze” your credit?
A credit freeze is a service provided by the three major credit reporting agencies that will allow you to restrict access to your credit report. How does this help me you may be asking? When opening a new credit account, most (not all) creditors need to see your credit report before they will approve opening up a new account. When a credit card company does a credit check, they’re accessing your report to see if you’re creditworthy. So you are limiting access to your credit report from any outside person or company by placing a credit freeze on your information.
How do I start a credit freeze?
To place a credit freeze on your credit reports, you will need to contact each of the three credit reporting companies: Equifax, Experian, and TransUnion. While TransUnion and Experian weren’t involved in the Equifax data breach, all three companies use the same personal information. Once you contact one of the companies, you will need to identify yourself by providing your name, address, date of birth, social security number, and some other pertinent information.
There can also be fees associated with setting up the freeze so ask about this in advance. The fees are usually determined by the state in which you reside and they can be anywhere from $2 up to $15. There are usually fees to set up the freeze and also additional fees to have the freeze removed, so be sure to ask about this before agreeing to a credit freeze.
How will a credit freeze affect me?
If you need to open up a new credit account, or are applying for a new job, renting an apartment, or buying almost any kind of insurance, then you will need to temporarily lift the freeze. You do this by contacting the companies again and providing the PIN or password that you were provided with when setting up the freeze. You can lift the freeze for specific parties or lift it for a specific timeframe.
There can be fees for lifting the freeze, so you will want to check with each company in advance. You can also talk with the business to see which credit reporting company that they will be using so that you can save money and not need to lift it on all three agencies. Once you submit your request, it will take no longer than three business days for the freeze to be lifted.
While a credit freeze blocks access for most businesses, there are some exceptions to the credit freeze. You’re still able to access your own records, and existing creditors (and their debt collectors) have access; along with government entities. They can still have access to your report.
How else can I protect my information?
A credit freeze can be a helpful tool for making it difficult for hackers to open up new accounts in your name but existing accounts still need to be protected. With the Equifax data breach, hackers stole names, social security numbers, birth dates, addresses, driver’s license numbers, and even credit card numbers.
For existing accounts, you should continue to monitor your credit and bank accounts for any suspicious charges. If your card was compromised, you should request a new one from your financial institution.
Protect your information from being misused by hackers. Freezing your credit can be one of many steps you can take to protect yourself, and minimize the impact of the Equifax data breach.
Equifax is also offering free 1-year enrollment in their TrustedID Premier credit monitoring service. This service includes copies of your Equifax credit report, 3 bureau credit file monitoring, Equifax credit report lock, social security number monitoring, and up to $1 million in ID theft insurance.
If you are a victim of identity theft or suspect that your information has been misused, you must take immediate action to limit the amount of damage, making sure you document everything. Check out this very informative blog post that I wrote about identity theft protection and the steps you should take if it happens to you: https://www.advantageccs.org/articles/identity-theft-protection