Closing the Barn Door

One of the increasingly common headlines these days is how hackers have wormed their way into the computer system of some retail chain or university, stealing the personal information of thousands of users. Many of us may be wondering if there’s anything we can do to help protect our hard-won credit with this kind of illegal activity going on outside of our control.

Actually, there is.

It’s called a credit freeze. This tool – also known as a security freeze – lets you restrict access to your credit report, which in turn makes it harder for identity thieves to open new accounts in your name. Most creditors need to look at your credit report before they can approve a new account. So, if they can’t see your file, they may not extend the credit.

According to the Federal Trade Commission, the federal consumer protection agency, a credit freeze does not affect your credit score. It also will not stop a cyber-thief from making changes to your existing accounts. You’ll still need to monitor all your bank, credit card and insurance statements for fraudulent transactions.

A credit freeze will also NOT keep you from opening a new account, applying for a job, renting an apartment or buying insurance. The FTC says you’ll have to lift the freeze temporarily – either for a specific time or for a specific party (such as a landlord or employer). The cost and lead times to lift a freeze can vary, so check with the credit reporting company in advance.

Close the Door

So, how do you go about putting a security freeze on your credit? Contact each of the nationwide credit reporting companies: Equifax, Experian and TransUnion. You’ll need to supply your name, address, date of birth, Social Security Number and other personal information. There may be a fee, based on where you live, but it commonly ranges from $5 to $10.