Fraud Alert or Credit Freeze: What’s Right For You?



Are you considering placing a fraud alert or credit freeze? In the wake of the Good Lenders data security incident, many people are considering it. You don’t have to be a victim of identity theft to use these options, but it’s helpful to consider your situation. If you are not sure what is best for you, we list some points to consider.

What are fraud alerts and credit freezes for?

With a fraud alert , businesses should try to verify your identity before issuing a new credit under your name. Usually, that means they have to call to see if you’re in a particular store trying to get new credit. With a credit freeze or lock , no one, not even yourself, can access your credit report to open new accounts. You will get a PIN number to use every time you want to freeze or unfreeze your account to request a new credit.

How long do fraud alerts and credit freezes last?

A fraud alert lasts 90 days. You can renew it, but you need to remember it or it will expire automatically. Victims of identity theft are entitled to a prolonged fraud alert, which lasts for seven years. In most states, a credit freeze lasts until you temporarily lift it or permanently remove it. In a few states, it expires after seven years.

How much they cost?

Fraud alerts are free. Credit freezes may charge you a fee depending on applicable state law. In most states, it is free for victims of identity theft. For other people, it costs between $ 5 and $ 10 each time the account is frozen and unfrozen at each credit reporting agency.

How do I go about placing a fraud alert or credit freeze?

To place a fraud alert , contact one of the top three credit reporting agencies, either by phone or online. The agency you are calling must notify the other two. If you are a victim of identity theft and place a prolonged fraud alert, you will also need to mail or upload your Identity Theft Report to the internet. To place a credit freeze , you must contact each of the three credit reporting agencies on their respective credit freeze portals.

In summary? Credit freezes are a more powerful tool, but may not be an option for everyone. Consider the cost and inconvenience. If you are about to take a new credit (apply for a mortgage, a car loan or a student loan) you will have to freeze and unfreeze your account every time you want to take a new credit. But if you’re not going to need credit right away, then a credit freeze might be right for you.