Are Credit Freezes Only Good for the Dead?

Dear Debt Adviser,

You wrote in one of your recent columns about freezing credit for someone who is deceased. Can a living person get this kind of credit freeze, too?

-Thomas

Dear Thomas,

You don't need to die to freeze your credit. There are several ways to freeze it right now. If you do so, you can still access your existing credit lines. Adding new credit, or making changes to existing accounts, is another matter.

Most people who place a freeze on their credit reports are doing it in response to something that's already happened. They may have been a victim of identity theft, or they have reason to believe they may become a victim of identity theft due to a data breach. A freeze prevents your credit report from being pulled by anyone other than the government, which blocks thieves from opening new credit accounts or redirecting existing ones to new addresses.

To place a freeze on your credit reports, you must do so with all three credit bureaus separately, unless you are an identity theft victim. You can do so online, by phone or by mail. Fees for establishing or removing a security freeze will depend on the laws in your state. If you are a victim of identity theft and can provide proof to the bureau, the freeze is free.

The downside to placing a security freeze on your credit is that it also kills your chances of obtaining new credit. Let's say you wanted to take advantage of a credit card offer from an issuer offering bonus points or a furniture dealer who will give you 48 months to pay for a new couch. You would need to contact the bureaus and use your personal information and PIN associated with the freeze to apply for new credit.

Additionally, a freeze could gum up the process of other decisions that are made using your credit report, such as buying insurance, getting a new job or a security clearance. The security freeze will remain in place until you contact the bureaus and have it removed. Read Bankrate's article "Protect with credit freeze or fraud alert?" to learn more about how to set up a freeze.

The Fair Credit Reporting Act also provides a way to freeze your credit by installing a fraud alert on your credit reports. A fraud alert requires the creditor to obtain permission from you before approving requests such as an increase in credit limit or a change of address on existing accounts. For new accounts, the creditor is required to make sure that you are the person making the request for new credit.

Anyone can request that a 90-day fraud alert be placed on your credit report. You can make the request from any of the three major credit bureaus, and that bureau will send the request to the other two.

If you are a victim of identity theft, you can request an extended fraud alert be placed on your credit reports, and it will remain for seven years unless you request that it be removed. Active-duty military can request that an active-duty alert be placed on their credit for 12 months.

Good luck!

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