Credit File Fraud Alert Before Security Freeze
Credit File Fraud Alert Less Drastic than Credit File Security Freeze
Many consumers are confused about the pros and cons of a credit file fraud alert versus a credit file security freeze. Let’s take a look at what is similar and what is different about these two avenues of self protection against identity theft and credit file fraud. Federally the Fair Credit Reporting Act provides very effective protections. Your home state may offer additional robust legal options. The massive TARGET breach involving about 40 million credit and debit accounts has caused a flurry of activity in the credit file fraud area. Target has arranged free credit monitoring services with Experian for these victims. Of course that means no credit monitoring for Equifax and Trans Union.
Your credit card issuer will provide 100 percent protection as long as you cooperate promptly.
Credit File Fraud Alert
An initial 90 day fraud security alert indicates to anyone requesting your credit file that you suspect you are a victim of credit file fraud. All it takes to implement this is a telephone call to one of the credit reporting agencies. The alert can be extended up to 7 years by submitting an “identity theft report” to the bureaus. This report consists of any credit file fraud affidavit or police report. When you or someone else attempts to open a credit account in your name, increase the credit limit on an existing account, or obtain a new card on an existing account, the lender is required to take steps to verify that you have authorized the request. If the creditor cannot verify this, the request should not be satisfied. Any credit bureau you place this request with will notify the other 2 credit bureaus without further action on your part. The Fair Credit Reporting Act requires that fraudulent entries have to be blocked from your report within 4 business days.
Credit File Security Freeze
If you are very concerned about becoming a victim of credit file fraud or identity theft, a security freeze might be the answer for you. Placing a freeze on your credit report will prevent lenders and others from accessing your credit report entirely. This will prevent them from extending credit. Once you have a security freeze in place you will be required to take special steps when you wish to apply for any type of credit. You must name the person for whom or the period of time for which you wish to unfreeze your credit. There is a small fee to thaw and refreeze. This step generally does not impact those creditors with whom you have an existing relationship. Most States have a small fee of about $10-$15.00 x 3 for all 3 bureaus to register for this procedure. No fee will be required if you have been a victim of credit file fraud or are 65 or older.
You will be issued a personal ID or password for this purpose. Remember to think ahead. The process of “unfreezing” may take several days This process of unfreezing is also completed through each of the credit reporting companies. Don’t be afraid to take this step if your circumstances have you worried. The peace of mind will likely be worth it to you.