All Your Friends Are Freezing Their Credit — Should You?

In light of a recent massive data breach, where a notorious hacking group reportedly released sensitive personal information from a major data broker, freezing your credit with the three major credit bureaus — Experian, Equifax, and TransUnion — has become an increasingly vital step in protecting yourself from identity theft and fraud.

The breach, which compromised the personal details of nearly 2.9 billion people, including Social Security numbers, highlights the risks of exposing your information online.

But credit freezes are an easy and effective way to mitigate the risks associated with such a breach by blocking unauthorized access to your credit reports and thus preventing criminals from opening new accounts in your name.

With a freeze in place, any attempt to open an account that requires a credit check will be denied, safeguarding your credit score. This protective measure is especially important in light of the most recent data breach, where information is already circulating online.

Here’s how to freeze your credit and why it’s essential in today’s digital landscape. By placing a freeze, you’re taking a proactive measure to prevent identity theft, especially given the extensive nature of the recent data leak, which experts say could serve as a "five-alarm wake-up call" for those who haven’t yet taken precautions.

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Why would you want to freeze your credit?

Credit freezes are handy tools for safeguarding your credit files and learning how to manage your money .

Though a freeze can’t prevent someone from getting a hold of your existing account numbers and racking up fraudulent charges, a credit freeze reduces your risk of having your identity stolen by blocking new hard inquiries to your credit reports. In other words, a freeze stops criminals from opening new credit cards or other lines of credit in your name.

All three credit bureaus will place a freeze on your credit report if you ask them to and you won’t be charged anything for this service. Credit freezes have been free since September 2018, thanks to the Economic Growth,

Regulatory Relief, and Consumer Protection Act. You can also request freezes on the reports of your children under 16 or anyone for whom you might hold power of attorney.

Lifting a credit freeze is also free and you can ask the agencies to do this via their websites, phone, or mail. If you make your request by phone or online, the freeze must be lifted within an hour. By mail, they have up to three business days after receiving your request to lift the freeze.

You can ask for the freeze to be lifted permanently or for a specific period of time. For example, if you want to finance a large purchase by opening a credit card, you can call or go online to lift the freeze for just that day so your application can be processed.

When your credit reports are frozen, you’ll still be able to access your own file and use credit monitoring services like Credit Karma and Credit Sesame, since they use soft credit checks.

Your existing creditors will also be able to see your reports, as will underwriting insurance and some government agencies if a search warrant, subpoena, or court order requires access.

The disadvantages of freezing your credit

Though freezing your credit can be a great way to safeguard your identity, there are a few drawbacks.

First, you’ll need to contact each bureau to request that a freeze be lifted if you want to allow someone access to your file. Sometimes a potential lender might be able to tell you which credit bureau they check, so you could just lift that one particular freeze.

But often the person or company won’t be able to tell you which bureau they use or they make a policy of checking multiple bureaus.

If you no longer have the personal identification number (PIN) the bureau gave you to verify your identity when you first placed the freeze, you may not be able to lift a freeze quickly.

TransUnion and Equifax require a PIN for making changes to your freeze via phone, and Experian requires one for all requests to change a freeze.

A credit freeze may also impact approvals for applications other than those from financial institutions.

It could cause delays in background checks for employment, gaining access to government services or payments, approval for rental housing, using digital signatures, or getting a new mobile phone contract.

What’s the difference between a credit freeze and a credit lock?

All three bureaus offer both credit freezes and credit locks. A credit lock restricts access to your credit files, has an accompanying mobile app and/or website for managing the service, and may come with fees.

Credit locks are a service offered by the bureaus that may come with additional protections, such as insurance against identity theft, regular credit updates from all bureaus, fraud alerts, etc.

Experian and TransUnion offer credit lock services as part of a paid identity theft protection service (though TransUnion does have a free option). Equifax offers credit lock services for free, as a result of the 2017 breach of their customer data.

Credit freezes, on the other hand, simply restrict access to your credit files as mandated and protected by law. There are no fees or extra services involved with credit freezes.

If you want to be able to turn access to your credit files on and off quickly from your computer or phone, a credit lock might be a better fit for you. You should also consider it if you want to get the extra identity protection offered by each bureau’s credit lock service.

If you don’t plan on having to allow access to your credit files often and are okay with having to call in or fill out a web form that may need a PIN, then a credit freeze is your best option. You can visit the Experian, Equifax, or Transunion websites to get started with placing a credit lock on your files.

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What information you need to have on hand to freeze your credit

First and foremost, the credit bureaus want to make sure you are who you say you are, so you’ll be asked to provide information they can check to verify your identity when you make requests regarding a freeze.

This information may include details about financial accounts, previous addresses, and other facts only you may know. These questions may even stump you — but that’s a good thing because the credit bureaus are really trying to protect your identity.

To make it through the initial freeze application or to lift a freeze, it’s a good idea to have the following on hand:

• Recent credit reports that include your loan history and dates of account opening
• Your address history
• Minimum monthly payments you make on your loans and accounts
• Names of lenders (current and former)
• Dates when your accounts were opened
• You’ll also need your current contact information and Social Security number.

How to freeze your credit with TransUnion

If you want to freeze your TransUnion file via phone, call 833-395-6933 from 8 a.m. to 11 p.m. Eastern, Monday through Friday.

To request a freeze online, go to the TransUnion Credit Freeze website and click “Add Freeze.” Complete the form on the page you’re brought to. You’ll be asked for your name, address, date of birth, email, and last four digits of your Social Security number.

Once you do this, you’ll be asked to create a TransUnion account. Complete the form, choosing a username, password, and security question. Next, you’ll answer a series of questions to verify your identity. Once this is done, follow the prompts to set your credit freeze.

How to freeze your credit with EquiFax

If you would like to place a freeze on your Equifax file by phone, call 800-349-9960 to access their automated system.

To place a freeze online, go to the Equifax Consumer Services Center and click on “Freeze your Equifax credit report.”

This will bring you to a page where you will create an account with Equifax. Complete the form, which will ask for your name, birth date, Social Security number, mobile number, and current address. After that, you’ll set your username and password and complete the identity verification process.

After you’re verified, sign into your new Equifax account. Click on the “Freeze” option on the left-hand side of the screen, then follow the prompts.

How to freeze your credit with Experian

If you would like to place a freeze on your Experian file by phone, call 888-397-3742 to access their automated system.

To place a freeze online, go to the Experian Security Freeze website and click on “Add a security freeze.” Then choose whether you want to freeze your own file or the file of minor or incapacitated consumer.

If you’re choosing to file a freeze request for your own file, select the first option and complete the form that follows. You’ll be asked to provide your name, Social Security number, date of birth, email address, and to select a PIN. Click “Submit” when done and follow the prompts.

If you’re choosing to file a freeze request for a minor or for someone for whom you have power of attorney, choose the second option, then complete the form and mail it in to Experian.

The bottom line

Given the recent massive data breach, putting a freeze on your credit files can be a good thing if you’re trying to add a layer of protection against identity theft.

Getting the freeze is free and easy, as is lifting it when you actually want someone to access your files. The drawbacks are mostly centered on inconvenience, which makes this a low-risk option for most consumers.

In all, choosing to freeze your files may be a smart thing to look into — and it's free.

Money tips that can work for everyone

No matter what your bank account balance is, there's always an opportunity to optimize and improve your finances. Here's a quick checklist of things you can look at today.

Focus on paying off your debt . Debt can hold you back from making progress with your overall financial well-being. Aside from cutting expenses, there are tools that can help you pay off debt faster like balance transfer credit cards and debt counseling.

Earning extra income can give you breathing room. If finances are tight, earning some extra money to supplement your income can make a huge difference. A new job is one option to consider, but if you're not ready to make a big change or already retired, a part-time side job could be a better choice.

Cut your expenses. It sounds painful and so not fun, but it doesn't have to be. Take a look at your biggest expenses because that's where you'll probably find the biggest savings. For example, auto insurance rates have been soaring so shopping around for a new insurance company can be the fastest way to cut your bill. Also, look for ways to cut your grocery bill (despite rising inflation).