Should You Freeze Your Credit Report?

A consumer can freeze a credit report if they are a victim of identity theft or credit fraud. It can also be frozen if someone suspects their personal information will be used for a crime. Identity theft and credit fraud are when a person uses someone's personal, or identifying, information to commit fraud.

Identity Theft and Credit Fraud Personal

Personal and identifying information can include your social security number, credit card account numbers, banking account numbers, online user names, passwords and patient records. A person commits the crime of  fraud when they use that information to open new credit accounts, take out loans, rob financial accounts or use available lines of credit. This includes the unauthorized use of credit card accounts.

Penalties for identity theft and credit fraud can be severe. Title 18, Section 1029 of the United States Code, states that a person who is guilty of a first offense of credit or identity fraud may be subject to a fine and incarcerated for fifteen years. A person guilty of a second offense of identity theft or credit fraud may be punished with a jail sentence of twenty years and can also be charged a fine.

What is a Credit Report Freeze?

A credit report freeze is also known as a security freeze. It is an action initiated by a consumer to block access to their credit report or credit file. The consumer must contact the three major credit bureaus, or reporting agencies. The credit bureaus gather and share information contained in your credit report with creditors and financial institutions. When you are granted a security freeze by a credit bureau, creditors and financial institutions are not able to access your credit file. This can prevent new credit accounts or lines of credit from being opened in your name. A security freeze can be temporary, or permanent, depending on your personal circumstances.

Freezing Your Report

If you need to freeze your report, contact the credit bureaus and tell them you would like to request a security freeze. Let them know whether the freeze is temporary or permanent. Charges for security freezes vary by state. If you have suffered credit or identity fraud, you can request a security freeze for free. You will need to provide the credit bureau with a copy of a police report regarding the fraud incident in order to receive the free security freeze.

The credit bureaus are required to provide you with written confirmation once a security freeze has been added. If you do not receive confirmation from all three credit bureaus, contact them again and tell them you have not received a security freeze confirmation. It is important the confirmation be in writing for proof it has been executed by the credit bureaus.

You will need to continue to request freezes on your account, until they become permanent. Be sure to ask how long their security freezes last so that you can properly gauge your credit report.

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