Credit Freeze
BeginnerA credit freeze is a restriction, available in the United States, that stops credit bureaus from sharing a person's credit report with new lenders, making it much harder for anyone to open new accounts in that person's name.
A credit freeze, also called a security freeze, is mainly used to protect against identity theft. Because most lenders check a credit report before approving new credit, blocking access to the report prevents fraudsters from opening loans or credit cards using stolen personal details.
In the United States, placing and lifting a freeze is free by law. A person must contact each of the three main credit bureaus, Equifax, Experian and TransUnion, separately. When they want to apply for credit, they can temporarily lift the freeze and then reinstate it.
For example, someone whose personal information was exposed in a data breach might freeze their credit to stop criminals from using it to borrow money.
A freeze does not affect a person's credit score or existing accounts, and it does not stop existing creditors from checking their report. Other countries offer different protections. In the United Kingdom, for example, people can add a protective registration or notice of correction to their credit file through fraud prevention services, which prompts lenders to carry out extra identity checks.
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