Does Freezing Your Credit Report Protect You Completely?

In an attempt to protect their identity and credit from fraud, many people use the option to freeze their credit report. With this option they can stop companies and lenders from checking their credit report without their permission. The goal is to deter new accounts from being opened without their knowledge, thus protecting themselves from identity theft. But does freezing your credit report completely protect you from fraud and is it worth the trouble?

Freezing Your Credit Report

In order to freeze your credit report you have to contact each of the three major credit reporting companies, Equifax, TransUnion and Experian, and let them know you want to put on a freeze. Just contacting one company does not ensure that they all will start the freeze so you must contact them all. After contacting these companies you will be given a personal identification number, PIN, that you can use when you decide to "thaw" your accounts. Your accounts can be thawed for three to thirty days before the freeze begins again unless you contact each company in writing that you want the freeze lifted entirely.

Freezing your credit report is available to anyone in any state but there will be a small fee for freezing your report unless you have been a victim of identity theft.

Does Freezing Completely Protect You?

While freezing your credit report will protect you from some companies checking your credit report it will not stop all companies from doing so. Companies, banks and lenders that you already do business with will still be able to obtain a copy of your credit report. Also, there is still the chance that someone can steal your identity if companies don't bother to check your credit report before issuing credit. Another person can rent an apartment or open a store credit card in your name if your report isn't checked. So there are still ways for your identity to be stolen even with a freeze on.

Is Freezing Worth the Trouble?

When you have a freeze on your credit report you will have to thaw it every time you apply for a credit card or loan and then it will cost you to re-freeze your report. If you don't apply for new credit cards or loans very often then this may be a viable option for you. If you do it may cost you more in fees then the service is worth.

While freezing your credit report is a good way to have added protection against identity theft it does have its downside. This is a good option for those who have established their credit but may not be for those still building their credit. Your decision to freeze your report should be based on how safe you feel leaving it open against how actively you use your credit.