Security Corner Blog

When it comes to protecting your credit and personal information, fraud alerts and credit freezes are two powerful tools at your disposal. Both can help prevent identity theft and fraud, but they work in different ways and offer varying levels of protection. Let’s dive into the details of each to help you understand which might be best for your needs.

Understanding Fraud Alerts

A fraud alert is a notice placed on your credit report that instructs creditors to take extra steps to verify your identity before extending new credit. This means that if someone tries to open a new account in your name, the creditor will typically call you to confirm that the application is legitimate.

Types of Fraud Alerts:

1. Fraud Alert: Available to any consumer, this standard alert lasts for one year and can be renewed. It does not require you to be a victim of identity theft.
2. Extended Fraud Alert: Designed for identity theft victims, this alert lasts for seven years and requires a police report or a report to identitytheft.gov. It also removes your name from marketing lists for credit and insurance offers for five years.
3. Active-Duty Fraud Alert: This alert is for military service members and lasts for one year, with the option to renew for the length of deployment. It also removes your name from marketing lists for two years.

How to Place a Fraud Alert

Placing a fraud alert is straightforward. You only need to contact one of the three major credit bureaus (Equifax, Experian, or TransUnion), and they will notify the other two. Here are the contact numbers:

• Equifax: 800-685-1111
• Experian: 888-397-3742
• TransUnion: 888-909-8872

Lifting a Fraud Alert

You can lift a fraud alert by contacting any one of the credit bureaus. Most fraud alerts expire after a year unless you extend them. Removing a fraud alert can increase your risk of identity theft, as it makes it easier for someone to apply for credit in your name without additional verification.

Understanding Credit Freezes

A credit freeze, also known as a security freeze, goes a step further by preventing lenders from accessing your credit report entirely unless you lift the freeze. This makes it highly unlikely that new credit accounts can be opened in your name without your consent. You will need a password or PIN to lift or "thaw" the freeze.

To freeze your credit, you must contact each credit bureau separately. When you need to apply for new credit, you can unfreeze your credit temporarily or permanently.

Fraud Alert vs. Credit Freeze: Which Should You Choose?

A credit freeze is recommended for most consumers because it offers the strongest protection. A credit freeze does not expire, so you don't have to remember to renew it. However, if you plan to apply for credit frequently and don't want the hassle of freezing and unfreezing your credit, a fraud alert might be a better choice.

Impact on Your Credit Score

Neither a fraud alert nor a credit freeze affects your credit score.

A credit freeze only restricts who can look at your credit reports. It doesn't affect your score or stop you from using credit.

A fraud alert is simply an extra layer of security; it doesn't affect your credit score either. It's easier to apply for credit if you have a fraud alert rather than a credit freeze because an alert doesn't require any lifting or removing first.

Both allow you to check your credit report.

Can You Have Both?

Yes, you can have both a fraud alert and a credit freeze for added security. However, it’s important to note that neither a fraud alert nor a credit freeze can prevent fraudulent charges on an existing credit card account. It’s up to you to monitor your statements and set up alerts for unauthorized charges. If you discover a problem, act quickly to dispute fraudulent charges to limit your liability.

Conclusion

Choosing between a fraud alert and a credit freeze depends on your specific needs and how actively you plan to apply for credit. Both options are free and can provide significant protection against identity theft and fraud. By understanding the differences and how each works, you can make an informed decision to keep your personal information safe.

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