Balance freedom, credit access
The freedom to access credit quickly and securely is something American consumers have enjoyed for decades. But dramatic increases in criminal hacks have challenged the way we all treat our personal information. Timely access to credit is essential to how we manage our finances, and restricting that freedom might not be the best solution for most consumers.
Consumers have a series of tools available to fight identity theft. First, every American should check their credit report at AnnualCreditReport.com. That will show whether there are any errors or unusual activity requiring attention. Similarly, a credit monitoring service alerts you to significant changes in your credit report. Free fraud alerts are another option. Fraud alerts tell lenders that they have to take extra steps to verify your identity if you apply for credit.
People who have been victims of identity theft — those who have actually had false accounts opened in their name — should consider credit freezes. These are free for victims and other vulnerable consumers such as seniors. For others, there may be a nominal charge, under state laws.
A credit lock is also available and is similar to a freeze when it comes to stopping a credit application, but it is generally a self-service option that consumers can control online anytime, anywhere.
It’s important that consumers understand all of these options and choose the best one for their unique situation, especially if they are planning to buy a home or car, take out college loans, open a credit card, rent an apartment, or finance a cellphone.
Credit freezes may be right for some people, but not right for everyone. While freezes protect consumers from one kind of fraud, freezes may delay transactions, purchases or job offers. Freezes are last lines of defense, and there are better options for most people — primarily fraud alerts.
While freezing credit may be an option for some, most Americans will find that fraud alerts, as well as some other options, provide the right balance of security and freedom to access credit.