Most states now give you the legal option to request that the credit bureaus freeze your credit. What this means is that nobody can run a credit report on you while your file is locked. Since the credit bureaus will not report your credit to a lender, the lender is not likely to approve credit. This, in theory, will reduce the chance of someone who has gotten a hold of your personal information from being able to open credit cards or other loans in your name. Of course this also means that you can't apply for any credit unless you remove the lock. This is a fairly new option in many states and the laws are being added to all the time. In most cases the states regulate how much the credit bureaus can charge you for this service. Victims of identity theft are often given the option to further lock their credit for free.
The credit bureaus are also getting on line with this and are beginning to offer such services on their own, regardless of state regulations. So even if your state does not mandate such protection you can still get it. Of course, in states without specific laws they can charge whatever they wish for these services. You may qualify for a free initial freezing of your file. However, if you use your credit often you will find that the 10 plus dollar fees for each time you open and close your file will add up. Run this across the three credit bureaus and you have a significant expense. The crux of these freezing services relies on the concept that you have lost your personal information somehow and that this is your last line of defense. Being prudent with your personal information in the first place and making it difficult for someone to get your data is likely a better use of your energy. Basic techniques include keeping your social security number private, shredding all of your personal documents, and never putting your personal information on a unsecured on line connection. Getting yourself a mail box rental at one of the stores that specialize in these services is also a great idea. All of your credit related mail should be sent to this address. This eliminates the risk of people stealing your credit card statements or other credit offers from your home mail box. A very simple but common method of stealing ones identity. Of course, we have all heard of hard disks with thousands of files being lost and stolen at big companies and from government agencies. There is little you can do to prevent such a thing and the credit freeze would certainly be beneficial in such a situation. One additional benefit of freezing your credit is that you will stop receiving pre-approved offers for credit. This is a benefit in reducing your junk mail and also in keeping the pre-approved offer from falling into the wrong hands. The choice of whether this last line of defense and the hassles it presents is worth it is up to you. You have to weigh the possible benefit versus the costs. In order to order a credit lock you will have to send each credit bureau a certified letter asking that they do this. Each bureau and state will require a slightly different process. You may have to provide some information to prove that you are who you say you are. Since all of this varies across the board the best approach is to contact the credit bureaus directly and ask them what the current procedure is for your state of residence. You can obtain contact information for the three major credit bureaus at the links below. http://www.equifax.com http://www.transunion.com http://www.experian.com One final note. All of the credit bureaus have a dazzling array of special programs that they would love you to buy and sign up for. You need to look at these offers critically and determine if they really are a good deal for you. You could easily end up paying $10-15 per month per bureau for services that you don't really need.
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