Fraud And Freezing Your Credit

Copyright (c) 2010 Liz Roberts

It all started in 2003. A credit freeze law was first introduced in California but it was not until the year 2007 when the three (3) major credit bureaus- Equifax, Experian and TransUnion- announced that they would allow people to freeze their credit report. Let us first discuss what a credit freeze is and why it is being used by more and more people.

Credit Report Freeze – What it Means

A credit freeze, which is also called credit report freeze or a credit report lock down, gives an individual the control over his/her credit report. It is done to prevent other people from accessing your credit report unless you give them permission to do so. Lenders, insurers, potential employers, landlords, marketing companies etc. will not be allowed to tap into your credit report while it is on freeze. You can’t even access it yourself.

You can gain access to your credit report again if you are going to make a request for a “thaw” or “unfreeze” from the credit bureau. Credit freeze is often viewed by people as a way to prevent other people especially scammers from accessing data from your credit report.

The Difference Between Credit Freeze and Fraud Alert

If someone is trying to open an account using your name, the creditor is then alerted to contact you (as the credit report owner). That is a fraud alert. It is not that reliable because a creditor can either choose to contact you or ignore this alert and continue with opening the account without letting you know. While if it a credit freeze, your report is totally not accessible no matter who is trying to access it, not even you. A creditor who wishes to get data regarding your credit report would just receive a message stating that the report has been frozen.

If you are planning on opening a new account, then you have to request for the freeze to be lifted. A credit freeze gives more protection when it comes to fraudulent acts or identity theft.

How do you freeze your credit report? With regards to fraud alert, it is simpler because you can just call the credit bureau and request for an alert. On the other hand, freezing a credit report requires more work. Here is how it is done: first

Freezing and Unfreezing Your Credit Report

Freezing your credit report. First, you should send a letter of request to the credit bureau. Together with this request are all the requirements for freezing. For instance, you would need to submit at least 2 copies of your proof of identification with your letter. There is also a freezing fee of $10 to $12 (the freezing fee varies depending on the state of residency) every time you make a request for a credit freeze. In some states, victims of identity theft are allowed to waive the freezing fee. They are just required to submit proper documentation such as police report or identity theft report to support their claim.

Unfreezing your credit report. This process can be done in minutes or up to 3 days or even a week with a fee of another $10 to $12 depending on the credit bureau holding your credit report. Again, you have to send a request to have it done.

There is also an option of unfreezing your credit report for a limited period of time. This is usually done when the credit report owner is applying for credit. He/She can request the credit bureau to just allow a few people to access your report. You just have to specify the names of these people.

Some people think that freezing their credit report can be very time-consuming considering the fact that you need to unfreeze it every time you want to access it, but if you would consider the importance of it, which is giving you protection from identity theft, then it’s well all worth it.

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New Horizon Business Services, Inc NHBS, Inc has been providing consumers and business owners with financing since 1989. Join our mailing list for
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How do i control my late credit card payment?

Latest question regarding How do i control my late credit card payment? from Yahoo: ok so I have 2,3 credit cards, and I’m so lazy to pay the bills. so I haven’t used my cards lately, but for not paying it up I keep getting late fees charged. I got like $300 late fees on my cards all together. I keep saying I’ll call them but I don’t. I have weird schedule. I work at night, and sleep during the day.

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Answer: If your late payment was a 1 time thing then they might be nice and remove the fee for you. However, if you are constantly late this is not going to happen. Also, if you are always late you have(or will be) bumped up to the default interest rate which is in the 30%+ range.

If you can not trust yourself to spend a few minutes to pay your bill on-time there are a couple of things to do. Check with your credit card company if they have on-line bill payment. If they do they probably have an option to automatically pay your bill every month. However, this usually will just pay the minimum and if you keep it at that amount it will take forever to pay off your account. The second option is to check with your bank that has your checking account. Most also have an On-Line bill pay that they can do the similar thing.

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