How to freeze your credit and when it makes sense

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Identity theft is a growing threat, with over 1 million cases reported to the FTC in 2023 alone. Thieves can use your identity to open fraudulent bank accounts or credit cards in your name. 

Fraudsters need your information — Social Security number, credit card details, birthdate — to commit fraud, so it’s important to safeguard that data. But thieves also access consumers’ information through data breaches, which you might not learn about for months.

Another powerful tool to stop thieves in their tracks? Freezing your credit. Here’s how it works and when it makes sense to freeze your credit.

What is a credit freeze? 

A credit freeze is a tool that allows you to seal your credit reports, preventing new accounts from being opened in your name. When a freeze is in place, creditors cannot access your credit file, making it difficult for thieves to exploit your information.

When you apply for credit, lenders review your credit reports to assess your creditworthiness. By preventing access to these reports, a credit freeze stops fraudsters from opening new accounts, even if they have sensitive data like your Social Security number.

A credit freeze doesn’t affect your credit score; you can still access your credit report. If you're applying for credit, a job, housing, or insurance, you'll need to lift the freeze to allow access to your credit file.
Credit freezes are free to place and remove at all three major credit bureaus: Equifax, Experian, and TransUnion. Some bureaus also offer a service called a credit lock, which allows you to lock and unlock your reports using an app. However, credit locks may come with a monthly fee.

"Deciding whether to use a credit freeze or a credit lock ultimately comes down to whether you're looking for the least expensive option (free) or you're more interested in getting the full complement of available security options with a price tag,” says Daniel Cohen, co-chair of Consumer Attorneys PLC's consumer finance practice. 

A credit freeze is not a complete shield against identity theft. Existing accounts can still be compromised, and your Social Security number can still be used for fraud, such as filing false tax returns or claiming medical benefits.

Despite this, a credit freeze remains one of the most effective ways to protect your credit. By sealing off your credit reports, you regain control over who can access your sensitive information, giving you peace of mind. 

How to freeze your credit 

Freezing your credit is easy and can be done online, by phone, or via mail with each of the three major credit bureaus: Experian, Equifax, and TransUnion. You must freeze your credit with all three bureaus to ensure complete protection.

Here’s a breakdown of each option:

Once you decide how you want to freeze your credit, here are the steps to do so: 

1. Depending on your method, you can visit the credit freeze page on each bureau's website, call the freeze line, or write a letter to each bureau. 
2. You must provide your name, address, date of birth, Social Security number, and other identifying information. You may have to answer some questions based on information in your credit file. For example, you may be asked what company you send your mortgage payments to. If you apply for a freeze by mail, your request must include your full name, complete address for the past two years, Social Security Number, date of birth, copy of a government-issued ID, such as a driver’s license, and a copy of a utility bill or bank statement showing your current mailing address.
3. The bureau will confirm when the freeze is in place. 
4. Keep your login information and password safe to log back in to pause or restart a freeze. If you request a freeze or thaw by phone, some bureaus require a PIN, so safeguard that number. 

Cohen says that once you've made your request, the credit bureaus are required by law to place the freeze within one business day. If you've requested by mail, they have three business days after receiving your letter to place the freeze.

When to consider a credit freeze 

Your personal information has been part of a data breach 

Data breaches affected over 353 million people in 2023, according to the Identity Theft Research Center. Placing a credit freeze should be your first defense if you’ve been notified that your personal information was exposed in a data breach. Hackers can use stolen data to open fraudulent accounts in your name. 

If your wallet has been lost or stolen, a credit freeze can provide some relief while you work on securing your accounts.

You spot suspicious activity on your credit report

Regularly monitoring your credit report is one of the best ways to catch identity theft early. If you notice accounts or inquiries you don't recognize, it's a red flag that your information may be in the wrong hands. A credit freeze can stop the bleeding, preventing additional unauthorized accounts from being opened.

If you've already been a victim of identity theft, a credit freeze is crucial to the recovery process. By locking your credit, you can focus on disputing fraudulent charges and accounts without worrying about new ones popping up.

You’re a caregiver for a “protected consumer”

Children and incapacitated adults are targets for identity thieves because the crime can go undetected for years. As a parent or legal guardian, you can freeze the credit of those under your care. By doing so, you can protect their finances from the long-term damage of identity theft.

Even if your child is too young to have a credit report, it's wise to check with each bureau and place a freeze if one exists. This proactive step can save headaches down the road.

You’re deployed military

Active-duty military personnel are at heightened risk of identity theft, especially during deployment. With your focus on serving your country, monitoring your credit can take a backseat. Placing a credit freeze before deployment can provide much-needed security and one less worry for you and your family.

You simply want extra protection

In truth, everyone can benefit from the added layer of security a credit freeze provides. Even if you haven't been a victim of identity theft or part of a known data breach, being proactive can save you from future headaches.

Who can access my credit when it’s frozen?

You're effectively sealing off your credit report when you place a credit freeze. This means that lenders, card issuers, and even employers performing a credit check cannot access your credit file. However, there are a few exceptions to this rule. Even with a freeze in place:

• Existing creditors or debt collectors can still access your report. This means that if you have a credit card or a loan, that lender can still review your credit file.
• Government agencies may have access to your frozen credit report in response to a court order, subpoena, or search warrant.
• You, of course, can still access your credit report. A freeze does not prevent you from checking your credit or getting credit reports from each bureau.
• Certain background check services may still be able to access parts of your credit report.

A credit freeze does not provide complete protection. It doesn’t prevent unauthorized charges on your existing accounts. It also doesn't stop misuse of your Social Security number for other forms of identity theft, like fraudulent tax returns. Credit monitoring and identity theft protection services can help alert you to other suspicious activities.

How to unfreeze or thaw your credit 

When you're ready to apply for credit, you'll need to lift or "thaw" your credit freeze to allow potential creditors to access your credit report. 

You can lift a freeze for a specific creditor or a set period, after which the freeze will automatically be reinstated. Like placing a freeze, lifting one can be done online, by phone, or through mail. Here’s a step-by-step process for each: 

When you request a thaw online or by phone, the credit bureau must lift the freeze within one hour. If your request is made by mail, they have three business days after receiving your request to lift the freeze.

It's important to plan if you know you'll apply for credit. While credit freezes can be lifted quickly, giving yourself a few days' buffer is wise, especially if you're requesting it by mail.

Once your credit application is complete, don't forget to reinstate the freeze if you lifted it permanently or for an extended period. You can easily do this using the same methods described above. Keeping your freeze in place when you're not using your credit is an effective way to protect your credit file from unauthorized access.

Alternatives to credit freezes 

While credit freezes are a great tool for preventing identity theft, they're not the only option. Depending on your situation and needs, you might consider these alternatives:

Fraud alerts 

A fraud alert is a cautionary flag placed on your credit report. It signals to potential creditors to take extra steps to verify your identity before granting credit. Unlike a freeze, a fraud alert still allows your credit report to be pulled. 

“Lenders can still run a credit check under your name, but before approving any new trade lines, they require direct authorization through your account,” says Cohen.

There are three types of fraud alerts:

• Initial fraud alerts last 90 days and are ideal if you suspect you may be a victim of identity theft.
• Extended fraud alerts for the last 7 years for confirmed victims of identity theft.
• Active duty military alerts last 1 year for deployed military personnel.

Fraud alerts are free and only need to be placed with one bureau, which will notify the others. They can be a good choice if you're actively applying for credit and want an extra layer of security without the restrictions of a freeze.

Credit monitoring 

Credit monitoring services watch your credit reports and alert you to any suspicious changes, such as new accounts or inquiries. They don't prevent identity theft like a freeze, but they can help you catch it early. Many services also offer assistance with recovery if you do become a victim.

Credit monitoring can be a paid service or may be offered free after a data breach. Some people choose to supplement a credit freeze with monitoring for added protection.

Identity theft protection services 

These services go beyond just credit monitoring to help protect your overall identity. They may monitor your Social Security number, public records, and black market websites for signs of your personal information. Many offer insurance to cover costs associated with identity recovery.

While these services can be valuable, they can also be pricey. It's important to compare options to find the right fit for your needs and budget.

Ultimately, the best defense against identity theft is a layered approach. You can reduce your risk by combining a credit freeze with other protective measures, such as monitoring and smart privacy habits. 

Frequently asked questions about credit freezes

The bottom line 

A credit freeze is a free tool to control access to your credit report and prevent fraudulent accounts from being opened in your name. However, individual action is required with each credit bureau and may increase the time it takes to apply for new credit. 

As Kyle Luetters, certified financial planner at Moneta, says, "spur-of-the-moment credit applications are more problematic" with a freeze in place. Nonetheless, he keeps his file frozen and advises his clients to do the same. 

Regardless of the method you choose – credit freeze, fraud alert, or monitoring service – safeguarding your credit is crucial to protecting your finances from identity theft.

Editorial disclosure: Opinions expressed are author's alone, not those of any bank, credit card issuer, or other entity. This content has not been reviewed, approved, or otherwise endorsed by any of the entities included in the post.