A voluntary credit freeze helps credit holders control the use of their credit profile by credit bureaus. By freezing the profile, it’s an indication to the bureaus that they should refrain from supplying details in the history to anyone requesting them. It prevents loan providers and other financial entities from making inquiries. 

In that same vein, lending agencies and credit card issuers will be unable to approve new applications except if the products don’t require credit checks. 

The process means to protect credit from potential identity theft, in cases where someone uses another person’s credit details to secure either a loan or credit card and then reaps the benefits from the financial solution. 

The risks associated with freezing your credit are few, but the primary, and critical, benefit is a protected or secured identity from fraudulent activity. 

Is a Credit Freeze the Answer 

While all three credit bureaus will put a credit freeze or hard stop on a profile for credit holders, and it’s legally mandated, many people are unaware of the option or what it involves. Please visit besterefinansiering.no/kredittsperre/ to gain insight into the concept. 

Also referred to as a “security freeze,” the action means to prevent anyone from viewing your profile. That includes loan providers, credit card issuers or any financial entity. 

Some may consider the move extreme, but when encountering fraud or identity theft with few measures found to be effective against the situation, it could be the only solution. While no one will be able to access your credit history, you will be forced to remove the block if you need to apply for credit. 

It’s suggested that this method be used as a last step instead of using it as a preventive or precautionary measure. It can be daunting when trying to maintain a normal lifestyle including renting a home, buying a car, getting insurance policies, interviewing for a new career opportunity and so on. 

Here are a few factors to consider before deciding to put a freeze on your credit and, in turn, restrict certain aspects of your life. 

Understand the fundamentals of the process 

Credit fraud can damage a profile and score considerably, leading consumers to protect themselves sometimes using extreme measures like freezing their credit. No one can view the reports when profiles are frozen until the block is lifted. 

That also means your life is relatively restricted from obtaining credit but no one else will be able to use your details to do so either. You can either temporarily or permanently lift the block to gain access if you need to be approved in a personal application or contract and then put it back on. 

How to freeze your credit 

When freezing credit, a request must be made with each major credit bureau to be valid and effective. The bureaus will pose a series of questions to validate your identity. Additionally, you will need to confirm your social security number and supply a photo ID along with a utility invoice to show proof of residence. 

The bureaus may ask you to create an account to make freezing and lifting the block more straightforward in the future. 

If you intend to make an application or contract requiring an inquiry, you will need to lift the block either permanently or temporarily before entering the agreement. Click here for guidance on how to freeze credit and why you should. 

A credit freeze can be done at no cost 

Freezing and lifting the block can be done at no charge. In the distant past associated fees were charged for the process with each state varying in their rates. Nowadays, however, regardless of the location, it is legally mandated that credit freezing be performed at no cost to the consumer. 

That’s true whether you’re using it in a preventive context or are a victim of fraud. Again, in the distant past, fees were waived when the service was related to criminal activity. The reasons are irrelevant today with everyone permitted to freeze their credit with no cost from the bureaus. 

Freezes don’t guard against everything 

While freezing credit can prevent individuals from committing fraud by opening accounts without your granting permission, these blocks can’t prevent identity theft overall. 

It limits the use of an identity stolen by preventing them from committing fraud when trying to open new accounts; however, if someone were to steal a debit or credit card number, they could still make unauthorized purchases. 

If someone were able to obtain your social security number, the freeze on your credit would not prevent the person from using that number for fraudulent activity like filing tax returns. You must be vigilant if someone has stolen sensitive details above and beyond freezing your credit. 

Think ahead and act swiftly 

When applying for a financial solution or putting in a contract for employment or an apartment, there can be delays. Still, they’re different for contracts than for applications for financial solutions. Lending agencies and credit issuers typically won’t extend credit on a frozen account. 

Typically, when calling the bureaus, some will offer as soon as an hour turnaround time for unfreezing the profiles; legally, they must. The unfreezing via mail can take roughly “three business days from receipt.”  

Delays are possible particularly if you forget to lift the block before making an application or entering into a contract. You can avoid any delays by considering the process before entering into any agreement whether a lease, employment or loan and credit card. 

Final Thought 

For anyone who is a victim of fraud or identity theft, a credit freeze can be beneficial in addition to fraud alerts and credit monitoring for extra precautions. These safety measures will prevent anyone from accessing your profile from opening a new loan account or credit card in your name. 

You will also be prevented from obtaining a loan or credit card as well as entering into contracts for other aspects of your life, including employment, insurance, and rentals. Fortunately, lifting the block is relatively straightforward and can be done permanently or temporarily by phone in as soon as an hour. 

Staying on top of your credit profile prevents fraud, minimizing damage to your history and protecting your score.