The Benefits of the Credit Report Freeze

There are times when credit card holders literally put their credit cards in a freezer just to keep themselves from using their credit cards for unnecessary purchases. If they feel like buying on an impulse using their credit card, they wouldn't be able to do so, because by then they would still have to defrost their credit cards before they can use them.

The principle behind a credit report freeze is pretty much the same as literally freezing credit cards. When a credit report is on a "freeze", it is totally inaccessible from anyone. Not even you- the owner can look into your own credit report, unless you ask for it to be "thawed", "defrosted", or "unfrozen". In this way, your credit report is completely protected from unauthorized people who may try to open new accounts in your name or steal your identity.

Freezing Your Credit Report

What do you need to do to freeze your credit report? Unlike putting a fraud alert, credit freeze can't simply be done over the phone. You would need to send a request letter to the credit bureau along with 2 copies of your identification. A fee of $10 to $12 is required for each credit freeze request.

Once you've put your credit on freeze however, there's no need for you to renew it unless you requested for a lift. For instance, if you wanted to get a new credit card or if you want to apply for a home loan or if you're applying for a new job, you would need to "unfreeze" your credit report so that your prospective lender or employer can check on your credit. In this case, when you want to put your credit back on freeze, you would need to pay again the $10 or $12 fee.

Unfreezing your report is also not free. You will be given a confidential PIN code that you can use when you want to "unfreeze" your credit report. It will cost you $10 to $12 and can take from within minutes to a few days before the freeze can be lifted. So if you'll need to give it some time before you start submitting your application to a lender.

Benefits of Credit Freeze

Obviously, a credit freeze is an important step in protecting yourself from identity theft and unauthorized access in your report. Although a fraud alert is supposed to warn creditors to notify you whenever a new account is opened in your name, this warning is often overlooked or ignored by creditors. With a credit freeze, lenders have no choice but to notify you first so you can "unfreeze" your credit report.

Putting your report on a freeze can also keep you from opening too many credit card accounts every time you receive a seemingly attractive offer. Since having too many credit cards put you at more risk of overspending and credit card debts, a credit report freeze is a good barrier for you to think about your decision more carefully before applying for another credit card.

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