Sometimes referred to as a security freeze. So what is a Credit Freeze? It is a toll that everyone should have in their credit arsenal. A credit freeze can be placed on your credit report to stop your credit information from being shared with anyone. Anyone? Yes, anyone, even your creditors.
So why freeze or lock your credit information? Well, if you are a victim of identity theft, that is one good reason. Especially, now that the Christmas shopping season is here. Many people fall victim to having their credit information compromised. Most identity theft occurs, not because your credit card was lost or stolen, but because someone uses your information…a waiter in a restaurant, family member or roommate who has access to your personal information.
How can a Credit Freeze help? It makes it more difficult for an identity crook to open a new account in your name. New account fraud is the most costly to identity theft victims because identity crooks often open more than credit card accounts. They use your information to apply for car loans and mortgages in your good name.
HOW DO I FILE A CREDIT FREEZE?
Simply request a credit freeze in writing to each of the 3 Credit Reporting Agencies: Equifax, Experian or TransUnion. Be sure to mail your request Return Receipt Requested. This proves that you made the request and it also obligates the Credit Reporting Agencies to respond to your request(s). Include your name, your current and former address. Your social security number and your date of birth. Each of the Credit Reporting agencies have guidelines, you can give each one a call and they will instruct on their procedures for the request.
In New York state the cost of a credit freeze is $5.00 so be sure to include payment. A Credit Freeze will work best if you freeze at all 3 Credit Reporting Agencies. You will be given a pin number from each agency. This pin number will enable you to temporarily lift the freeze when you need to apply for credit or give a company access to your credit report. For the address and telephone numbers of each Credit Reporting agency please go to http://www.petersonministries.org.
A credit freeze means that your credit file cannot be seen by potential creditors, insurance companies or employers doing background checks unless you give your consent and you give your consent by temporarily lifting the credit freeze.
How long does it take for a credit freeze to go into effect? Currently, credit agencies are required to put the freeze in place 5 days after they receive your letter. After Jan 1st they will have 4 business days to complete the freeze. And after Jan 2009 they will have 3 business days to get the job done.
Can I open new credit accounts while the freeze is on?
Yes. You can lift a freeze temporarily for $10. For identity theft victims the lift is free of charge. When you want to lift the freeze, contact the credit reporting agency…each agency has specifics on lifting the freeze, so contact them and they will let you know what to do. Keep in mind you must provide proper identification and you will need the pin number that you were given when the credit freeze was first installed.
Suppose you want a specific creditor to have access to your credit report while the freeze is in place. Notify the credit bureau who the creditor is and be specific as to the length of time you want them to have access. Give the credit bureau 3 business days to do a temporary lift.
What happens when a creditor requests to see your file while it is frozen? That creditor will see a message or a code stating that the file is frozen.
Can a creditor get my credit score while my file is frozen? NO! A creditor who requests your credit information will be notified that the file is frozen per your request.
Can I get a copy of my credit report while my file is frozen? YES.
Keep in mind that although you may have a freeze on your credit report, certain entities (companies) will still have access to it. Your report can be released to your existing creditors or collection agencies that your creditors have hired to collect for them. Certain government agencies have access when it comes to court orders or subpoenas.
Will a freeze lower my credit score? NO
Can an employer do a background check on my credit file? NO. You will have to complete a temporary lift.
What about pre-approved offers? The credit freeze does not stop those. To stop those call 888- 567-8688 or log onto http://www.optoutprescreen.com
A credit freeze gives you more control over who views your credit report. And that can be empowering. Empowering ourselves is what it is all about.
The New York security freeze bill went into effect November 2006. It is also known as Assembly Bill 7349.
To schedule a Credit Improvement seminar/workshop for your organization, group, company or church please call James or Barbara Peterson at 315-446-3294 or write to: Peterson Ministries 825 Northway Stereet Syracuse, New York 13224.
For more Credit Improvement tips tune into Improving Your Credit Worthiness on WSIV 1540 AM every Wednesday 2 – 2:30pm. You can also log onto http://www.petersonministires.org.