[ALERT] Freeze Your Credit Files (all SIX of them)

What Is A Credit Freeze?

A U.S. federal law went into effect in 2018, allowing citizens to freeze and unfreeze access to their credit report files for free. Previously, credit reporting agencies were allowed to charge for that service. When you order a freeze on your credit file kept at a Credit Reporting Agency (CRA), it means that no one – including you – can access the credit data in the file without your prior explicit permission.

So after you freeze your credit file, if you want to apply for a loan or new credit account, you will have to contact the credit reporting agency used by the lender to allow that lender access to your credit report; all other entities will remain frozen out. That lender’s access can be limited to a specified period of time, at the expiration of which the freeze returns.

In some cases, you can tell a credit reporting agency to allow a specific lender ongoing access to your credit file while freezing out everyone else. Simplest of all options is to toggle the freeze on and off for everyone, but don’t leave the freeze off any longer than necessary

The federal law – actually, a set of amendments to the Fair Credit Reporting Act and related existing laws - supersedes a patchwork of state laws regarding credit freezes. It makes freezing and unfreezing your credit files free of charge to you. Credit reporting agencies used to charge as much as $10 every time you froze your file. They even charged fees to unfreeze a file, despite the fact that it is very much in a CRA’s best interest for you to leave your credit file unfrozen.

Most people have heard about the Big Three credit reporting agencies: Transunion, Experian and Equifax. But there are actually SIX that you should know about. I'll give you contact information and credit freeze details for all of them in this article.

Why Freeze Your Credit Files?

Credit reporting agencies collect credit data from creditors, and sell their accumulated data to many different kinds of nosey firms. Your credit report is the foundation of the enormous distributed dossier of personal data about you that exists unless you have been living off the grid all your life. Credit reporting agencies make a lot of money selling data about you. This new law gives you the power to control credit data about you even though it is "owned" by CRAs.

Identity theft is much more difficult when a target’s credit file is frozen. Most credit files contain all the data needed to open a bank account, rent property, replace a “lost” driver’s license or state ID card, and generally impersonate you.

Freezing your credit files helps to stop privacy leaks at their roots. As I said, a credit file is the foundation of the dossier that tells marketers – among other types of firms - what you buy, where you buy it, how much you spend, and other personal data obtained through Web activity tracking and other marketers’ tricks. Without your credit file data, nosey firms have a more difficult time keeping track of you. And of course, identity thieves have a more difficult time attacking you as well.

A recent article by Krebs on Security detailed a gaping security hole in the Experian website that allowed identify thieves to access your credit report without answering the so-called “knowledge-based security questions”. It's not the first time a serious vulnerability was discovered at a credit reporting agency.

The Krebs article details two other recent issues with Experian, one of which exposed the credit scores of most Americans. TransUnion was sued in December 2022, after it was revealed that a data breach allowed millions of consumer files to be accessed without authorization. My article Equifax Takes The Data Breach Cake for details of how the 2017 Equifax breach allowed hackers access to the records of almost 200 million people.

A credit file freeze alone won’t completely eliminate the risk of privacy leaks or ID theft. The personal data needed to impersonate you is duplicated in many databases that have been stolen, sold, and resold by crooks many times. If a crook has a good reason to be interested in you particularly, he can piece together your personal data from the many stolen databases out there on the dark Web. But generally, ID thieves get plenty of victims from thefts of credit files and don’t look for more work. A credit freeze is a good start on protecting your identity.

Beware of “Credit Locks”

When you approach a credit reporting agency to freeze your credit, they may try to persuade you to implement a “credit lock” instead. They’ll tell you a lock is as good as a freeze and your credit file can be locked or unlocked in minutes instead of the “up to five business days” that it can take to freeze or unfreeze a file. There are two reasons to insist on a credit freeze instead of substituting a credit lock.

A credit freeze is free; the law forbids credit reporting agencies from charging consumers to freeze or unfreeze their credit files. And if you request a lift of the freeze, the agency must lift it within one hour. CRAs often lure people into credit locks that are free for a period of time but eventually cost an annual or monthly fee that is charged to your credit/debit card automatically. Or they may make the lock free if you accept online ads and marketing pitches; sales of advertising replaces consumer-paid fees.

And in some cases, a credit lock does not provide the same privacy protection as a freeze. For example, with an Experian credit lock, a potential employer or insurer can still see your credit report. But they can't if it's a frozen credit report.

A credit freeze’s terms are set by federal law, while a credit lock is a contract written by a credit reporting agency. That contract contains a clause that allows the CRA to change the contract’s terms unilaterally at any time. Appealing a change to terms of a credit lock or a breach of the contract is a tedious game rigged in a CRA’s favor; for instance, you may have to pay the fee of a private arbitration firm that is chosen by the CRA in question.

Insist on a credit freeze to get protection you can count on being there when you need it, and that can be enforced in public courts instead of private mock courts essentially “owned” by the credit reporting agency that does you wrong.

What About Fraud Alerts?

A fraud alert is another option to make it harder for identity thieves to open accounts in your name. According to the Federal Trade Commission (FTC), “A fraud alert makes companies verify your identity before granting new credit in your name. Usually, that means calling you to check if you’re really trying to open a new account.” To initiate a fraud alert, you can contact Equifax, Experian, or TransUnion and request it. It doesn’t matter which one, because each must notify the other two. A fraud alert is free and lasts one year.

By contrast, a credit freeze limits everyone (including you) from opening new accounts, unless the freeze is lifted. You must place a freeze with EACH of the three major credit reporting agencies. A credit freeze is free and lasts until you lift it. The FTC advises that credit freezes are best for people who aren’t planning to take out new credit.

In my opinion, a fraud alert is less effective than a credit freeze, because it provides less protection. What if a thief has your phone when Macy’s or Target calls to verify your identity? And what if you forget to renew the fraud alert after it expires? A credit freeze does not expire, cannot be lifted unless YOU request it, and the agency must unfreeze your account within one hour. That might be inconvenient if you’re at the store and you want to open a new credit card account. But choices are good.

The Big Three, Plus Three

Remember that I mentioned earlier that there are SIX credit reporting agencies that you need to know about? The fourth-largest credit reporting agency is Innovis, and you have probably never heard of it because who cares about a fourth-place anything? But you should put a freeze on your Innovis credit file as well as those maintained by the Big Three CRAs.

In addition, there are many firms that specialize in particular types of consumer data. One such firm of importance to most consumers is the National Consumer Telecom & Utilities Exchange. As its name implies, the NCTUE collects data used by telephone service providers and public utilities to approve a consumer for credit that enables opening of accounts for phone and Internet service, electricity, water, natural gas, trash pickup, etc. ChexSystems is yet another agency that collects and reports information about your checking and savings accounts. It behooves you to freeze these source of your personal data and potential enablers of ID theft as well.

Here is a summary of contacts for freezing your credit files by going online, calling by phone, or mailing a letter to the relevant credit reporting agency:

• Equifax Freeze Online
Phone: 1-800-349-9960 (automated), 1-888-298-0045 (live operator)
Mail: Equifax Security Freeze, P.O. Box 105788, Atlanta, Georgia 30348

• Experian Freeze Online
Phone: 1-888-397-3742
Mail: Experian Security Freeze, P.O. Box 9554, Allen, Texas 75013

• TransUnion Freeze Online
Phone: 1-888-909-8872
Mail: TransUnion LLC, P.O. Box 2000, Chester, PA 19016

• Innovis Freeze Online
Phone: 1-800-540-2505
Mail: Attention: Consumer Assistance, P.O. Box 1358, Columbus, Ohio 43216-1358

• National Consumer Telecom & Utilities Exchange Freeze Online
Phone: 1-866-349-5355
Mail: NCTUE Security Freeze, P.O. Box 105561, Atlanta, GA 30348

• ChexSystems Freeze Online
Phone: 800.428.9623
Mail: Chex Systems Inc., Attn: Consumer Relations, PO Box 583399, Minneapolis, MN 55458

NOTE: If any of the online freeze requests is not accepted, that could mean the agency has incorrect contact info for you on file, so you can't validate your identity via the online form. In that case, you should contact them by other means to make sure there are no errors in your credit file.

Oh, and don't forget your spouse, everyone has their own credit report, even after marriage.

Have you implemented a credit report freeze? Did you freeze ALL of your credit files? Tell me about your experience with freezing or unfreezing your credit file. Your thoughts on this topic are welcome. Post your comment or question below...