- Security freezes lock your credit history to avoid identity theft.lock image by Dwight Davis from Fotolia.com
United States consumers may place security freezes on their credit histories. These freezes, also known as credit freezes, prohibit most creditors from accessing the consumer's credit history without permission from the creditor. State laws regarding security freezes vary in terms of who may ask for a freeze and whether a consumer must pay a fee to freeze his credit. However, anyone who is concerned about fraud may place a security freeze by contacting the credit bureaus directly.
Consumer Right to Security Freeze
- As of September 2010, three states do not have laws regarding consumer freezes: Alabama, Michigan and Missouri. However, the three major credit bureaus, Experian, Equifax and TransUnion, give consumers the right to request a security freeze even if state law does not address the issue. Consumers who live in states without a security freeze law may have to pay a fee to each credit bureau to set a freeze.
Exceptions to Security Freeze
- If a consumer puts a security freeze on his credit history, most companies cannot access his credit without directly contacting him. However, current creditors and law enforcement agents can still access a consumer's credit even if he has placed a security freeze. Some state laws also allow employers and landlords to access credit regardless of security freezes.
Security Freezes and Identity Theft
- Some states require consumers to become victims of identity theft before they can place security freezes. Security freezes do not reverse credit granted to thieves or stop thieves from fraudulently using the consumer's identity in other ways, such as to open a prepaid telephone account.
Under federal law, consumers who have had their identity stolen may also place a fraud alert. Fraud alerts do not stop creditors from accessing the consumer's report; however, creditors must verify the creditor's identity prior to issuing credit if there is a fraud alert on her credit profile. Consumers may place both a fraud alert and a security freeze on their credit history to protect themselves from future fraud.