How to Freeze Your Credit During the Pandemic

According to the Federal Trade Commission (FTC), the United States saw 167,000 reports of identity theft and credit card fraud in 2018—quite a lot of headaches to deal with. Unfortunately, experts predict a lot more cases like this in 2020 thanks to the coronavirus pandemic. With more and more people working from home and making online purchases, cybersecurity risk is up as scammers and hackers try to take advantage of people’s online vulnerabilities.

Amplifying this problem is the fact that so many of us are facing financial hardship—over 33 million Americans have already filed for unemployment since the start of COVID-19. Because of job loss and loss of income, some individuals are finding themselves incurring more debt, struggling to pay bills, and seeing their accounts fall into delinquency. It’s not hard to imagine the amount of stress this causes—and since we know stress impairs a person’s ability to think clearly and make decisions, the economic situation might be putting even more people at risk of falling victim to fraudulent activity. 

But now for the good news:

If you’ve been worried about credit card theft and identity fraud, a credit freeze may be a great option for you right now. Credit freezes are relatively affordable and come with a lot of unexpected benefits. Plus, they’re simple to do and won’t negatively affect your credit score. (Really, they won’t!)

So, no need to panic if you think your identity has been stolen. Take a deep breath—and take action.  

Why Freeze My Credit During COVID-19?

When you freeze your credit, it prevents certain lenders and other third parties from viewing your credit history. According to the FTC, a credit freeze also makes it difficult for other people, like scammers and fraudsters, to open new accounts in your name. This is because creditors are unlikely to extend you any new credit if they can’t do an inquiry (“hard pull”) on your report, which makes criminal attempts to open new lines of credit in your name not possible. 

A credit freeze—available from each of the three nationwide credit bureaus (Equifax, Transunion, and Experian)—is essentially a step you take to boost your security. It won’t negatively affect your credit score, and it doesn’t change any information already on your credit report.

The FTC further assures that credit freezes do not prevent you from being able to:
  • Apply for a job
  • Rent an apartment 
  • Buy insurance
  • Get your free annual credit report

Credit freezes don’t even prevent you from being able to open a new account—but in order to do so you’ll just need to temporarily lift the credit freeze. You do this by using a password-protected credit bureau account or a PIN number. Snafus and delays aren’t necessarily out of the question, however, so don’t be surprised if you experience some hiccups. 

One thing credit freezes aren’t able to do is prevent scammers from making changes to any of your previously existing accounts, so you definitely should continue to monitor your bank, insurance, and credit card statements for any questionable activity or charges. But if you’re worried that your identity has been stolen, a freeze will protect you against thieves who might try to open new accounts using the stolen information.

Another thing a credit freeze won’t do is prevent creditors and lenders from seeing information about existing accounts you already have opened with them. In other words, a lender that you already have an account with can still pull your report, even if your credit is frozen.

You are still expected to make payments during a credit freeze.

Most lenders and creditors are empathetic to people’s situations right now. If you’re having a hard time making your minimum payments, there’s honestly no need to feel ashamed. Contact your lender and ask what kind of assistance and options are available to you. Equifax even suggests adding a consumer statement of up to 100 words (or 200 words in the state of Maine) to explain your current financial situation.

What’s The Difference Between a Credit Freeze and a Fraud Alert?

Unlike a credit freeze, which effectively locks your credit and prevents it from being accessed unless you temporarily or permanently lift the freeze, a credit alert or fraud alert  does allow creditors to pull copies of your credit report—provided they take additional steps to verify your identity. In other words, third parties only have access to your credit if it’s verified. 

An example of a fraud alert in action would be a potential creditor or lender having to call you personally and verify that you are the one making the credit request at the phone number you provide during the application process. This provides enhanced security without having to freeze your credit. But, as is true for credit freezes, fraud alerts may not prevent misuse or fraud on existing accounts you already have.

Fraud alerts are free

Once initiated, a fraud alert is generally effective for one year. Fraud alerts are free: as noted by the FTC, all you have to do to initiate one is contact one of the major three credit bureaus. The credit bureau you contact will then tell the other two and all three will activate the alert.

A good time to enact a fraud alert would be if you are not yet a victim of identity theft to your knowledge, but have reason to be concerned that you’re at risk of becoming one—say, for instance, because you lost your wallet, Social Security card, or other personal, financial or account information. 

Generally speaking, credit freezes offer better protection than credit alerts. So, if you’re truly concerned about identity theft and fraud, you may consider choosing a freeze instead. 

How to Freeze Your Credit 

Got a pen ready? Jot down these simple step-by-step instructions on how to freeze your credit: 

  1. Contact one of the three major credit bureaus (Equifax, Transunion, and Experian) to request a credit freeze. You should be able to do this online or over the phone with a customer service representative. 
  2. Be prepared to supply your name, address, date of birth, Social Security number, and other relevant personal information.
  3. Once your freeze request has been placed, the credit bureau will give you a unique personal identification number or password. Hold on to this—you’ll need them when you want to lift the freeze later on. 
  4. Repeat steps 1 through 3 for each of the other two credit bureaus.

To save you some time, we’re listing the contact information of each credit bureau here (look for the security freeze icon on each homepage):

Remember, to freeze your credit, you’ll need to request a freeze with each of the three credit bureaus. Depending on your situation and location, this may mean you need to pay around $60 or more (about $20 per freeze request), although it may be free in some cases. 

When you want to “thaw your credit” or lift your freeze (temporarily or permanently), you’ll just need to contact each credit bureau to let them know. A lift can take as little as an hour or as long as three business days. It may take more time, depending on your situation. Keep in mind that you may need to pay an additional fee to temporarily or permanently lift your credit freezes.

5 Other Ways to Protect Your Finances and Identity During the Coronavirus Pandemic

In addition to freezing your credit, there are other things you can do to become more cyber-secure and reduce your risk of identity theft, credit card fraud, and overall finance vulnerability. Here are five tips from Consumer Affairs:

  1. Watch out for COVID-19 scams. These are fronts for identity thieves or scammers trying to steal your money and information (or take advantage of your generosity). Common scams to be aware of include:
    1. Fraudulent e-commerce vendors for personal protective equipment, testing kits, disinfectants, and other supplies
    2. Fraudulent investment sites
    3. Phishing and vishing (criminal phone fraud) through emails, texts, and voicemails
    4. Spoofed government and health organization communications
    5. Fake vaccines or “miracle cures”
    6. Fake employment posts and job offers
    7. Fake charities
  2. Secure your home wireless network using things like strong passwords and WPA2 or WPA3 encryption.
  3. Loving that WFH (work from home) life? Just be sure to lock or shut down your work computer when you’re not using it. 
  4. Treat all emails that contain links or attached files as suspicious, even if they’re from a person or organization you know and especially if they’re from someone you don’t know. Only open files and attachments if you’re confident about their legitimacy. If your bank emails you asking for information, don’t go through the link provided in the email—head to their site directly or call the number from their webpage.
  5. Keep your anti-virus and anti-malware software up-to-date, and consider using additional security features such as two-factor authentication.
The Bottom Line

If you suspect you’ve been a victim of identity theft or are concerned about your financial safety during the COVID-19 pandemic, you don’t need to panic. These things happen, and finance safeguards like credit freezes are in place to help people do some much-needed damage control. 

And while credit freezes won’t necessarily leave you 100% protected from criminal activity, they can offer some important peace of mind—which is ever more valuable in the world we’re living in today. 

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