Top 3 reasons you should freeze your credit right NOW!
UPDATE: Now that the #EquifaxBreach #TMobileBreach and a ton of others have occured, credit freezes are the best way to get some peace of mind and protect yourself against would-be identity thieves… It’s not a matter of IF it will happen, it’s now a question of WHEN the fraudsters will decide to use your information. Freeze Credit NOW! Read on! – 1Sept2021
When you head off to work each morning, do you shut the front door? Do you lock it? You’re probably saying “Duh! Of course I do!” Right? Most Americans are walking around with their “credit identity doors” wide open. In fact, they usually don’t even know they have the ability to close that door AND lock it.
Years ago, when I first left my mom and dad’s house for college, I began to receive credit card solicitations in the mail. My mom told me it was a good idea to go ahead and open a major credit card and establish some credit, but taught me to use my credit very responsibly. That turned out to be great advice and I was proud to watch my credit score tick higher and higher over the years. I bought my first house when I was only 24! However, when my home was burglarized and laptop stolen while I was at work, I wondered how I could prevent the thieves from opening credit in my name. That’s when I discovered I could lock my credit file down and hide the key!
YES! Freezing your credit might make applying for new credit lines and loans a real PAIN in the future, but here are my top 3 reasons why I think it’s worth the trouble:
- A Little Peace of Mind: My mom called me and told me she found a box of my old college papers. I initially asked her to just throw it out. Then I realized WAIT! Our student IDs on all of our grade reports, registration forms and transcripts was our social security number! I know, I’m dating myself… no longer the case in most educational institutions, but if those documents did fall into the wrong hands, I would feel confident that the would-be identity thieves wouldn’t get very far with my sensitive information.
- Impulse Spending Control: I once received some financial advice from one of my wealthier clients. He said, the best way to control your credit spending is to take all of your credit cards and put them in a mason jar, fill it with water and freeze it. He said when you’re out shopping and you see something you hadn’t planned to buy, you’ll have to go all the way home to thaw your credit card jar and then go all the way back to the store. By that time, most likely, the impulse to buy will have passed. Sounds pretty extreme, and no, I never did that, but I held onto that basic philosophy by freezing my credit files. By the time I find my PIN numbers and thaw my credit, I will have given this major purchase plenty of thought.
- Better Than Most Credit Monitoring Services: When my home was burglarized, I was glad I had a security alarm because it alerted me and deterred the burglars from spending much more time inside my home, but it didn’t actually prevent the burglary. I’d really like to keep the burglars out in the first place. Most credit monitoring services (paid or free) will only alert you to the activity. Some will even help you clean up the mess. Wouldn’t it be great to prevent the credit identity theft from happening in the first place?
Why credit freezing can be a pain (but still worth the trouble):
- You’ll need to freeze all 3 credit bureaus (Equifax, TransUnion & Experian) in order to be properly protected. There is a small fee to freeze it which varies by state
- You’ll need to keep up with a PIN for future credit “thawing” (lifting the freeze)
- Thawing your credit for a new credit application will usually cost a small amount, which varies by state
Why credit freezing isn’t for everyone (but you should still consider it):
- A credit freeze is a good idea for people who are fairly stable, do not intend to move frequently, do not intend to apply for a new credit card or finance a new car, boat, home etc in the next year or so.
- A credit freeze is a bad idea for people who move around a lot and tend to lose their PINs.
HOW to freeze credit:
- Google “credit freeze” + Equifax, Experian and TransUnion
- Freeze each of these separately
Why would a 5-Star REALTOR® want people to lock down their credit? When I take on a new buyer, we quickly get into a conversation about credit. I’m always surprised how many people tell me they don’t have any idea what’s on their credit. I’m doubly surprised when it’s mortgage loan application time and they find out they’ve been the victim of credit identity theft. The process of disputing fraudulent credit items can be lengthy and can severely delay the homebuying process.
Now GO! Freeze credit! Do it NOW! Or don’t… ok, but at least now you know you can! And stop those annoying prescreened credit offers and cut down on all those junk mail credit card solicitations while you’re at it. DM and ask me how!