Credit freeze

What It Means

A credit freeze, also called a security freeze, restricts access to your credit reportCredit reportA record of how you've borrowed and repaid, kept by credit bureaus and sold to lenders, landlords, insurers and others who decide whether to deal with you. See more at a credit bureauCredit bureauA company that collects information about how people use credit and sells it as credit reports; Equifax, Experian and TransUnion are the three nationwide ones. See more, so a lender reviewing a new application in your name can't see it. The bureaus describe it as a way to stop someone from opening a new account, such as a credit card or loan, in your name. Under a federal law in effect since September 21, 2018, placing and lifting a freeze is free, and you set it up separately with Equifax, Experian and TransUnion.

How People Say It

• "I keep my credit frozen and thaw it when I apply for something."
• "Unfreeze your credit before the dealer runs it."
• "After the breach letter, I froze all three."

The Breakdown

What the rule says. The Economic Growth, Regulatory Relief, and Consumer Protection Act made credit freezes free at the nationwide bureaus starting September 21, 2018, according to the FTC. When you ask online or by phone, the bureau must place the freeze within one business day and lift it within one hour. The freeze lasts until you lift it, either for a period you choose or permanently.

Who it applies to. Anyone with a credit file at Equifax, Experian or TransUnion. People often place one after a data breach letter, a lost wallet or a sign of identity theftIdentity theftWhen someone uses your name, account details or other personal information without permission to open accounts, make charges or commit other fraud. See more.

What you need

1. A way to reach each bureau online or by phone, the two routes the FTC's timing rules cover.
2. The identifying details each bureau asks for to confirm it's you.
3. A plan for lifting it: before a loan, card, apartment or other application that needs your report, lift the freeze at the bureau the company uses, or at all three if you don't know.

Official source. The FTC's 2018 consumer alert "Free credit freezes are here" and its "Credit Freezes and Fraud AlertsFraud alertA note on your credit report asking lenders to verify your identity before opening credit; you place it at one bureau, which must tell the other two. See more" page set out these rules.

Good to Know

A freeze and a fraud alert are different tools: a freeze blocks access to your report, while a fraud alert asks lenders to verify your identity before opening credit, and a fraud alert placed at one bureau is passed to the other two. Some bureaus also offer a credit lockCredit lockA bureau's own service that blocks access to your credit report, much like a freeze, but under the company's terms instead of federal freeze law, sometimes for a fee. See more. The bureaus' own comparison pages say a freeze is free and protected by federal law, while a lock isn't governed by the same federal rules and may come as part of a paid service.

Related Terms and Categories

• Credit lock

  A bureau's own service that blocks access to your credit report, much like a freeze, but under the company's terms instead of federal freeze law, sometimes for a fee.

• Fraud alert

  A note on your credit report asking lenders to verify your identity before opening credit; you place it at one bureau, which must tell the other two.

• Identity theft

  When someone uses your name, account details or other personal information without permission to open accounts, make charges or commit other fraud.

• Credit bureau

  A company that collects information about how people use credit and sells it as credit reports; Equifax, Experian and TransUnion are the three nationwide ones.

• Credit report

  A record of how you've borrowed and repaid, kept by credit bureaus and sold to lenders, landlords, insurers and others who decide whether to deal with you.

• Credit monitoring

  A service that watches your credit reports and alerts you to changes, such as a new account or inquiry; it warns you after the fact and doesn't prevent fraud.

Debt and credit