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New Law Allows You to Freeze Your Credit for Free

In response to the massive data breech last year at Equifax, a new federal law will allow you to place a freeze on your credit file at no cost. Currently, you must pay a fee to do so. The law takes effect September 21, 2018.

Equifax, Experian and Transunion are the three major credit reporting agencies in the United States. They gather personal and loan payment information on anyone with credit. This data is factored into decisions such as whether you receive loans or credit cards, your credit limits, your interest rates, and the cost of your insurance premiums.

It was estimated about 143 million Americans – about half the population of the United States – had their personal information stolen during the 2017 Equifax data breech. This information, including names, social security numbers, birthdates, and some driver’s license numbers, is in the hands of thieves, available for them to use at any time – now or in the future.

One way to protect yourself is to place a credit freeze on your credit file at each of the three credit reporting agencies. A credit freeze restricts access to your credit file. Most creditors look at your credit report before they approve a new account or loan. If they don’t have access to your file, they may not extend the credit, making it more difficult for a thief to open an account in your name.

Currently, there is a fee, determined by each state, to place a freeze on your credit file. You need to pay this fee to each agency. And, when you want to temporarily lift the freeze to apply for a new loan, you pay another fee.

Beginning September 21, Equifax, Experian and TransUnion may no longer charge fees to place and lift a freeze on your credit file. Each agency is required to set up a webpage for requesting fraud alerts and credit freezes.

The new law, called the Economic Growth, Regulatory Relief, and Consumer Protection Act, also:

  • Allows you to place a place a credit freeze on a child’s credit file, regardless of where you live. This applies to children under age 16. Currently, only some states allow you to freeze a child’s credit file.
  • Changes the length of an initial fraud alert to one year. A fraud alert is a note in your credit file warning creditors that you may be an identity theft victim and that they should verify that anyone seeking credit in your name really is you. Currently the initial fraud alert only lasts for 90 days, after which you need to extend it for another 90 days. There are no fees for a fraud alert. If your identity has been stolen and you have filed a report with the Federal Trade Commission, you can still place an extended fraud alert on your file which lasts for seven years.
  • Requires the three credit reporting agencies to offer free electronic credit monitoring to all active duty military members.

The web addresses for each credit reporting agency are:

When you set up your credit freeze, each agency will give you a PIN which you will need to lift the freeze in the future. Keep the PINs in a safe place.

When you sign up for a credit freeze online, you will be asked a series of questions based on the information the credit reporting agency has in your file. Many of my clients have been unable to answer the questions, usually because they can’t remember the details of past loans. I have found it helpful to have a copy of a recent credit report on hand. The answers can usually be found in the reports.

To request a credit report visit annualcreditreport.com. You can also call 1-877-322-8228 or request reports by mail using the Annual Credit Report Request Form. Click here to access this form.

If you would like information on additional ways to project your personal information, read my blog post How to Protect Yourself Following the Equifax Security Breach.

This blog is published to provide you with general information only, and is not intended to provide specific or comprehensive advice.  Money Care, LLC encourages individuals to seek advice from competent professionals when appropriate.