Why Is There a Security Freeze on My Credit Report?

A security freeze, also called a credit freeze, prevents the credit bureaus from releasing your credit report to agencies, businesses, banks or any other entities wishing to view your credit file. As of March 2011, all three major credit bureaus offer security freeze services. A security freeze can go on your credit report for only one reason.

Voluntary

The only way a security freeze can go on your credit report is by your request. You can voluntarily place a security freeze on your credit reports by contacting each of the three major credit bureaus by telephone, mail or electronically on their websites. The three credit bureaus will place security freezes on your accounts immediately after receiving your request. These voluntary credit freezes will remain on your reports until you choose to remove them. As of March 2011, in certain states, bureaus may charge individuals a small amount to place or permanently lift security freezes on their credit reports.

Benefits

Many individuals decide to place security freezes on their credit reports when they suspect their identity information has become compromised, such as after losing their wallets or having their credit cards stolen. By placing a security freeze on your credit reports, you prevent fraudulent charges and unauthorized new accounts from being added to your credit record. Additionally, thieves or others with fraudulent intent will be unable to open new credit accounts in your name while the security freeze remains on your reports.

Drawbacks

Although a credit freeze can protect your financial profile by preventing individuals with fraudulent intent from harming your credit score, it will also prevent you from opening any new accounts or gaining access to new credit. Lenders, banks and credit card companies will automatically reject you when they see a security freeze on your reports.

Considerations

You can temporarily lift a credit freeze by contacting each of the three credit bureaus and asking them to withhold the freeze for a specific period of time or for a certain company. When temporarily unfreezing your account, you must present each bureau with a personal identification number or password. Additionally, placing a security freeze will not affect your credit score -- the three-digit number lenders use to calculate your creditworthiness -- in any way. In certain states, credit bureaus may charge you to temporarily lift a security freeze from your credit report.