With large-scale security breaches at retailers like Target and credit reporting agencies such as Equifax, having your identity stolen is a real possibility, allowing these thieves to open a new line of credit using your name. That’s why many people have their credit frozen to safeguard themselves. You can, too.
Why it works
When you freeze your credit it restricts access to your credit report, because a new line of credit cannot be opened without a credit check. This prevents criminals from getting a line of credit with your name.
How it works
Contact your credit agency and tell them to freeze your credit. While this used to cost around $10 per agency a new law states that credit agencies must freeze and unfreeze your credit free.
A little problem
A credit freeze is a good idea to prevent your identity from being stolen, or your finances breached, but it poses a problem if you want a mortgage. Although you’re trying to prevent hackers from stealing your money, you’re also preventing reputable institutions like mortgage companies and lenders, from accessing your credit score.
A big solution
Fortunately, federal law makes it more convenient than ever to get a mortgage while you have a credit freeze.
When you ask to unfreeze your credit the agency must get back to you within one hour of your request. To get a mortgage all you need do is let the mortgage issuer know that your credit is frozen, contact your credit agency, and unfreeze your credit once the agency has assured you that it’s safe. And you are, too.