Fraud Alert or Credit Freeze?

Identity theft is serious business! It is a fraudulent act that could harm your credit—and you. It occurs when someone pretends to be you by stealing your identity. Your name, credit card number and Social Security number are common sources for identity thieves.

What is a Fraud Alert?

A fraud alert is a message on your credit report that notifies potential credit grantors to verify your identification whenever there is a request for a credit using your identification.  There are three types of fraud alerts:
•    Initial Fraud Alert – This can help create peace of mind if you have concerns about identity theft or think you may be a victim of fraud. The initial fraud alert remains in effect for 90 days and warns lenders to verify your identity before granting credit.
•    Extended Fraud Alert – If you have been a victim of identity theft, you can get an extension on the initial fraud alert to protect yourself for seven years. The extended alert tells lenders you are a victim and asks them to notify you before granting credit.
•    Active Duty Alert – While deployed, military personnel can protect their credit for one year with this alert, signaling businesses to take extra steps before granting credit in their names. When you add an Active Duty Alert, your name is removed from preapproved credit card offers for up to two years as well.

What is a Credit Freeze?

A credit freeze is basically a credit report lock down. A credit freeze prevents new lenders from accessing your credit report unless you first lift the freeze. With a credit freeze in place, lenders and creditors are denied access to your credit files. This makes it more difficult for an identity thief to open an account in your name.

The Differences between a Fraud Alert and a Credit Freeze

Fraud Alert

  • It is placed on your credit file to notify lenders to verify your identity before extending credit.
  • Any one of the three main credit reporting agencies will notify the other two to place your fraud alert in their files.
  • The initial fraud alerts last for 90 days. You can extend it or renew it if you still have concerns after that time period.
  • You must file a police report before you can add an extended fraud alert.
  • Fraud alerts are free.

Credit Freeze

  • Prevents lenders from having access to your credit report unless you first lift the freeze.
  • Requires you to take special steps, including providing a PIN number before you choose to apply for credit while the freeze in is effect.
  • A security freeze remains on your file until you decided to lift it temporarily or have it removed completely.
  • You must contact each of the major credit bureaus separately to initiate or cancel a freeze.
  • You can freeze your credit file at no charge if you are a victim and have filed a police report.

Removing a Fraud Alert or Credit Freeze
To remove a fraud alert, submit your request in writing to the credit reporting agencies with which you have the alert or freeze. Include copies of documents that will help verify your identity. If you need to open a new credit account, you can request that your credit freeze be temporarily lifted. An additional option allows you apply for new credit with a single-use PIN that you give only to the new creditor for one-time use.
Checking your credit report regularly helps you guard against identity theft, since you’re able to keep an eye on anything that might be an indicator that someone has stolen your identity.