Fraud Alerts and Credit Freezes
If you have been the victim of Identity Theft, you may want to request a fraud alert or put a credit freeze on your credit report. Here is an explanation of what each is to help you decide which might be best for you.
When you place a fraud alert on your credit report, it requires creditors to verify your identity before processing any credit applications. You only have to contact one of the credit bureaus to place a fraud alert. The one you contact is required to make the other two credit bureaus aware. A "temporary" fraud alert can be placed by anyone at anytime. It lasts for one year or unless you cancel it sooner. If you've been the victim of ID theft, you may want to place an "extended" fraud alert. This type of alert lasts up to 7 years or unless you cancel it sooner. You do need a police report to verify that you were actually a victim of ID theft. Finally, there is also an "active-duty" fraud alert for those service members who are on remote duty assignments.
A credit freeze is a more severe measure. Placing a credit freeze on your credit report completely blocks creditors from running your credit. The only way they can run your credit is for you to lift the freeze. To place a credit freeze, you must contact all three credit bureaus. You will be assigned a PIN or password from each credit bureau to use when you want to lift the freeze. You must 'unfreeze' your credit report before applying for credit. You can temporarily unfreeze your credit report for a certain amount of time and then it will automatically freeze again. If you know the creditor you are applying for credit with uses (for example) TransUnion to run credit, you can simply unfreeze TransUnion and leave the other two in their freeze status.
If may be a good idea to freeze your child's credit. Scammers have been known to use social security numbers from children to apply for credit cards or loans. Also, for senior citizens, if you know you won't be applying for a loan, credit card, cell phone, etc, anytime in the near future, a credit freeze might be a good idea as well.
It's certainly easier to deal with unfreezing your credit report than it is to deal with all that comes with having your identity stolen.