A Credit Freeze is Now Free in All 50 States

credit card and smart phone

You can now put your credit on ice free of charge. | Kerkez/iStock/Getty Images

If you or someone you know was a victim of a data breach, one of the first things you probably looked into was getting a credit freeze. One pesky thing about the freeze, however, was having to pay a fee. Fortunately, these fees are a thing of the past. Starting Sept. 21, 2018, a credit freeze will now be free of charge in all 50 states. This is good news if you’re looking to protect your credit.

Here’s more information about credit freezes and why you might want to get one.

What is a credit freeze?

When you put a freeze on your credit, this means you can prevent anyone from opening new credit in your name. Most creditors need to review your credit report before approving a new account. If your account is frozen and they can’t see your credit report, they likely won’t extend new credit.

A security system for your credit

CreditCards.com analyst Ted Rossman compares a credit freeze to a home security system. It keeps the bad guys out and shields you from harm. In his column for CreditCards.com, he says it’s one step above credit monitoring:

Think of a credit freeze as a state-of-the-art home security system that helps keep the bad guys out, versus credit monitoring, which is more like that text message you got from a neighbor after someone already smashed through your living room window and walked off with your big-screen TV. In the latter case, the damage has already been done, so the alert isn’t all that helpful.

Why would you want to freeze your credit?

You’d want to freeze your credit if you were a victim of identity theft. This way, you can prevent further damage from being done to your credit. Another time you might want a credit freeze is if your information might have been compromised as a result of a data breach.

Why credit freezes are now free

Rossman says the law was written mostly because of the major Equifax data breach in 2017. The personal information of approximately 150 million consumers was compromised. “After years of high-profile breaches involving popular retailers (Target, The Home Depot, etc.) and websites (remember when 3 billion Yahoo accounts were hacked?), the Equifax breach proved to be the straw that broke the camel’s back,” says Rossman in his Credit.com column.

How much did a credit freeze cost?

Before the law took effect, in most states, the credit bureaus charged up to $10 for a credit freeze and an additional $10 to lift the freeze, reports Credit.com. Fortunately, it is now free to freeze and unfreeze your credit.

A credit freeze and your credit score

If you’re concerned that a credit freeze will affect your credit score, you have nothing to worry about. A credit freeze has no impact on your score.

Things to keep in mind

  • You can still conduct activities such as opening a new account or renting an apartment when a freeze is placed on your credit. However, you will first have to temporarily lift the freeze. There is no charge to lift or replace the credit freeze.
  • Some people can still see your credit report even after your credit is frozen. For example, your credit report could be shared with existing creditors or debt collectors.
  • If you want to place a freeze on your credit, all you need to do is contact one of the three major credit reporting agencies (TransUnion, Equifax, and Experian).

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