A security freeze, which is also known as a credit freeze, is a handy tool which enables you to keep your credit records safe from prying eyes and potential hackers. You are supplied with a personal identification number (PIN) known solely by you that can be employed should you seek to remove the freeze for specific credit related activities. This security measure insulates you from anyone that would open new accounts in your name. In addition, a security freeze does not impair the ability to use credit cards or lines of credit.
Why Institute a Security Freeze?
Security freezes are essential for those who suffer the ministrations of identity theft and have been offered for that purpose for some time. In recent years, however, all three of the major credit agencies implemented new regulations for people in various situations to use security freezes. Naturally, this service does require a small payment. Also, it is essential to be aware of the regulations that apply in your state of residence as each state possesses their own individual laws.
Also, people can institute a security freeze for the credit reports of their children that have yet to reach 18. For more information on the governing legislation in your area review the National Conference of State Legislatures website.
The fee for a security freeze normally is in the realm of $3 to $10 for each person. There are, however, states which do charge more for this service. Also, bear in mind a security freeze must be enacted with all three credit agencies. Additional fees apply if the freeze is for a specified length of time and for each agency.
When a Security Freeze is Not the Way to Go
If your credit scores are reviewed frequently for employment purposes or you open new accounts with a multitude of companies at regular intervals, it is not a good idea to implement a security freeze. The fees to continuously open your credit reports would simply cost too much to be worthwhile. A security freeze also does not protect any accounts that have already been compromised and your current account holders do retain the ability to view your credit scores. It is also important to realize a security freeze can take up to five days to be in place and it also take that long to remove it. Therefore, a security freeze should really only been used when you have experienced identity theft.