When Do Credit Inquiries Fall Off?

As someone who in the past was a victim of identity theft, I can assure you it is a very painful process and not something I would recommend for even my worst enemy. It took me more than a year to realize something was terribly wrong with my credit. I had just applied for a new car loan and quickly realized that someone else (an old college roommate) had thoroughly destroyed my credit scores.

credit freeze real world example

For other consumers, they find out in a different method albeit just as painful and embarrassing. They usually start receiving phone calls from junk debt buyers (collection agencies) about debts they had no idea even existed.

In light of this info, it is easy to understand why people like me started to block outside access to t our credit reports by “freezing” everything related to our credit files.

If you had your sensitive financial information compromised during the Target (or Nordstrom) security breaches and are worried about becoming a victim of identity a ‘credit freeze’ is one of the few tools available for consumers to fight back against identity theft.

A “credit freeze” is also known as a “security freeze”.

By placing this freeze on your credit reports you can block an identity thief from opening a new account or obtaining any type of credit line in your name.

This is also useful if you are getting lots of soft hits on your credit reports from pre-approved offers, as a security freeze keeps new creditors from accessing your credit report without permission from you first. So even if the id thief was able to swipe your Social Security number, they will be stymied when they try to open any new accounts because the creditors they are applying to cannot access your credit report.

In light of the recent rise in identity fraud (tax return fraud, etc..) most states now allow residents to place, temporarily pause, completely remove or request a new password for free. Even if you have reported id theft in the past, you are now entitled to a freeze by phone or mail.

You must contact each of the major credit reporting bureaus directly in order to place a freeze. You can do this through certified mail or online:

Trans Union Security Freeze
P.O. Box 6790
Fullerton, CA 92834-6790

Experian Security Freeze
P.O. Box 9554
Allen, TX 75013

Equifax Security Freeze
P.O. Box 105788
Atlanta, GA 30348

If you choose to mail your request in to the credit reporting agency, you must provide the following information to prove your identity.

1) Full legal name (including middle initial), your current mailing address, social security number, date of birth and current pin number if assigned on your account.

2) List all previous addresses you have had over the last 5 years.

3) A original bill such as your electric or cable bill to prove your current address.

4) A government issued identification card photo duplicate. This can be your driver’s license, military id or any other state issued form of identification.

One thing to note is that any agency involved with the government such as collecting child support payments, social services worker or IRS representative can continue to access your credit despite the freeze. Your previous established creditors can also still access your credit file too.

Most consumers do not fully understand how to take advantage of this security measure. Some think that they will not be able to open new credit lines themselves because of the hold. The truth is, you can apply just as easily for credit with or without the freeze. The hold just adds another layer of enhanced identity theft protection for you.

You can still apply but the creditor will not see your credit report information immediately, and may treat your application as incomplete but not rejected. All you have to do is provide the creditor you are applying with, with your password of pin number once they are attempting to process your forms.

If that process sounds cumbersome to you, you can also put a temporary lift on your account to. This is known as a “credit thaw”, whereby you are only temporarily making your credit report accessible. Once your new creditor has processed your application, you can contact the credit agency again to replace the hold on your credit file.

Other Options To Secure Your Accounts

There is one other option consumers have if they are not quite ready to commit to a total freeze. It is 90 day temporary block on your credit file and is known as a initial fraud alert. This is advantageous in light of the Target security breach as 3 months should be enough time to allow you time to review your recent transactions and also give you a set time for re-establishing direct creditor access to your credit reports.

In my case with my old roommate, my initial fraud alert turned into a extended fraud alert. This covered me for a full seven years. It was a pain at the time but the process has improved immensely since I filed in 2001. Once the extended alert expired in 2009, I moved on to the security freeze and will continue to use that for the rest of my life.

As a final word of advice about freezing your credit reports, sometimes putting a hold on your credit like this is not free. Charges can range from $2 to $10 and vary by lender. Although with the Target news and more companies reporting hackers gaining access to their databases, more and more states are requiring the credit bureau’s to offer a credit freeze for free.

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