The Equifax Breach of 2017 allows for greater Credit Security in 2018
Freezing your credit is now easier than ever as credit freeze restrictions and rules have been lifted for all states. No matter where you live in the U.S. you can freeze your credit for free with all three credit bureaus:
A credit freeze prevents lenders and credit providers from opening a new account or running a credit check without unfreezing your account. The change took place Friday, September 21, 2018. It was put into effect by the Economic Growth, Regulatory Relief and Consumer Protection Act, which was signed into law earlier this year.
Credit Freeze Benefits for You
This new freeze rule was initiated in part, due to the major data breach at Equifax last year which exposed the personal information of over 145 million consumers to hackers around the world. Consumers who want more control over their credit will now have it. Under the new bill, consumers can now freeze and unfreeze their credit for free. They also have the ability to freeze and unfreeze their children’s (under 16) credit for free. Any guardian, conservator, or person with the power of attorney, will now also have the same ability for anyone considered their dependent.
Another benefit is that any fraud alerts placed on a credit file will be extended from just 90 days to one year. When a fraud alert is placed on an account, it requires anyone, including creditors, to take extra steps to verify your identity before extending credit.
However, there is a bit of a downside. In order to freeze credit you must place a call to each credit bureau individually. But, on the upside, agencies have only 1 day to freeze your account. If the you choose to make a request by snail mail, agencies have 3 business days to take action.
If you choose to unfreeze your account, agencies are required to do so within 1 hour.
5 Factors to be Aware of When you Freeze your Credit
If you choose to freeze your credit, here are 5 factors to be aware of before you jump in feet first.
- Any application that you, or anyone with your information tries to run while your credit is frozen, will be rejected. This applies to both loan applications and credit cards.
- You will respond to a series of questions in order to validate your identity. In turn, you will receive a pin that will allow you access to your credit. We advise you not to share this pin with anyone and keep it in a safe place.
- A credit freeze does not protect everything. A credit freeze does not prevent financial loss if your credit card number is stolen. Remain cautious when entering your credit card number on any unsecured website.
- If your account is frozen, there will be a delay when seeking to retrieve data in association with a loan or credit card.
- You should continue to check your credit and bank accounts during a freeze period. Always remain vigilant where your money is concerned. Keeping an eye on your account will significantly lessen your chance that a breach will occur.
Lastly, if you are still concerned but, don’t necessarily want to freeze your credit other options are available. Consider signing up for fraud alerts. Credit agencies can put a warning on your credit report that requires anyone that checks your credit to take additional steps to verify your identity. We consider this to be a valid and secure option when it comes to protecting your credit.