Freezing Your Credit

Credit: dan at FreeDigitalPhotos.net

So my wife just joined a whole bunch of people who received a letter from a school in the Southeast explaining that some of her personal information may have been inadvertently exposed on the university’s website. That’s frustrating. What’s even more frustrating is that she didn’t even go to school there! Thankfully, she was a UGA Bulldog, but I digress…

It’s things like this that make you want to sand off your fingerprints and burn your Social Security Card. Every day in the news, there’s another data breach here or another identity theft ring there. It seems like an experience with identity theft is becoming just a matter of time, not a matter of if. With that in mind, today I thought I’d mention a defensive maneuver you can take called freezing your credit.

Historically, “freezes” were more available to previous victims of identity theft, but now all of the major credit bureaus are allowing people to freeze their credit for a small fee. Freezing your credit does not affect your credit score, it does not prevent you from getting your free annual credit reports, and it does not prevent your existing creditors or government agencies from accessing your credit report. It does allow you to temporarily seal your credit reports so identity thieves cannot establish new lines of credit in your name even if they are able to obtain a lot of your personal information. This is because most new creditors need to see your credit report before they will approve opening your new account. In short, if they can’t see your credit report, they probably won’t approve a new account for the identity thieves to go to town with!

If you’re going to be taking out a mortgage or a car loan in the near future, if you are going to be moving and opening up a lot of new utility accounts, or if you are planning on adding another credit card, I might not recommend this as there is a little administrative time involved and some slight costs to freeze and unfreeze (or “thaw”) your credit.

If things are running pretty normal, you want to have a little more identity protection, or you receive a letter like my wife did, you may want to consider this. Nothing is guaranteed, but it couldn’t hurt, and it might very well be the difference between “you” going on an unauthorized shopping spree and some disappointed identity thieves.

If you’re interested, contact Equifax, Experian, and TransUnion. And yes, either do all or do none or else your freeze will be incomplete.

Brrrr…

-Tom