How to ‘freeze’ your credit report
Q. Please help me understand the new rules and regulations about “Freezing” my credit reports?
A. Identity theft can happen to anyone, but consumers now have a new free tool to help protect themselves against scammers who would steal their financial information. The three nationwide credit reporting agencies in the U.S. (Experian, Equifax, and TransUnion) are required by a new law to allow consumers to “freeze” and “thaw” their credit report for free.
The new law, called The Economic Growth, Regulatory Relief, and Consumer Protection Act, went into effect September 21, 2018. This law does many things but the one most consequential to most consumers is that it changes the rules regarding credit freezes.
Until today, freezing your credit was governed by your state’s laws. Some states prohibited the credit reporting agencies from charging fees, but other states allowed fees. Credit freezes also have to be placed and lifted at each agency individually, and the process can be cumbersome and time-consuming. The number of situations requiring a credit check — upgrading your cell phone, applying for a job, signing a new lease, etc. — makes freezing and unfreezing your credit inefficient. As a result, many people don’t bother with a freeze unless they believe they are specifically at risk for identity theft.
With this new law, freezing and unfreezing your credit will be simpler and free.
You will still have to do so at each of the three credit bureaus, but they have online portals that will make the process much simpler. When a credit reporting agency receives an online or phone request to freeze someone’s credit, they have to execute it frozen within one day. Requests to unfreeze someone’s credit report must be completed within one hour. This makes it much easier to keep your credit frozen and then only unfreeze when you need to apply for new credit as the changes are free and can be done quickly and easily online.
A security freeze prevents the credit reporting agency from releasing your credit report while it’s in effect. Consumers are given a PIN or password that they must have in order to later thaw their credit report so it can be released again. You may read more about credit freezes; as well as locks and alerts at www.bbb.org.
The new law also allows any parent to freeze their child’s credit. A child’s credit report is especially valuable since it is clean and often not monitored regularly.
Finally, the new law extends initial fraud alerts on your credit report from 90 days to 1 year, and allows victims of identity theft to place a fraud alert on their credit reports for 7 years. Over the next year, the credit reporting agencies also are required to provide free credit monitoring services to all active duty military personnel.
Visit BBB’s scam tip page on identify theft at www.bbb.org to learn more about how to protect yourself from identity theft. And to learn about federal resources for protecting yourself and recovering from identity theft, visit www.identitytheft.gov. To understand the freezing processes at each of the credit agencies; use the following links:
› Experian — experian.com/freeze
› Equifax — freeze. equifax.com/Freeze
› TransUnion — freeze.transunion.com
Jim Winsett is president of the Better Business Bureau in Chattanooga.