What's the difference between a credit freeze and a fraud alert?

Things are done in the name of security. We give our accounts complicated passwords and lock our doors.

Our credit can be overlooked in our security efforts. It's not something we should be ignoring. Chances are good that our credit information has been exposed by the new reports of data breeches.

Extra layers of protection can be provided by credit freezes and fraud alert, even though it is nearly impossible to completely safeguard your personal information. If you decide to apply for a new line of credit, you will need to take additional action on your part, and they will not eliminate the threat.

You may wonder if the extra effort is worth it. Here are the differences between credit freeze and fraud alert and how they affect applications for credit.

What is the difference between a credit freeze and a fraud alert?

An alert is simply a fraud alert. An extra security measure is taken when you open a line of credit.

Credit freezes are more intense. No one will be able to open a line of credit in your name until the credit freeze is lifted.

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What is a fraud alert?

A fraud alert is an alert on your credit record that requires you to verify your identity in order to get a new line of credit.

The fraud alert will be displayed when a lender requests a copy of your credit report from one of the credit reporting agencies. The alert tells the lender that they need to do more to make sure you are the person applying for credit.

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There are credit cards that have a pausing button.

Types of fraud alerts

Three types of fraud alert are available.

• Temporary fraud alert: If you suspect you might be the victim of identity theft or your credit information might have been compromised, you can file a fraud alert that will apply for one year. (You can renew the alert for free.)
• Extended fraud alert: This type of alert is available to those who have already had their identity stolen and have filed a report with the Federal Trade Commission via IdentityTheft.gov or made a police report. It remains on your credit reports for seven years. This also allows you to request a free copy of your credit report from each of the three main credit bureaus twice within one year from when you place the alert — effectively letting you review your credit report six times to make sure no further instances of fraud occur.
• Active-duty military alert: If you’re serving in the military and are on active duty, you can protect your credit while you are away. This type of alert is good for a year and can be extended for the length of your deployment. What’s more, filing this type of fraud alert means the credit bureaus will take you off their marketing lists for unsolicited credit and insurance offers for two years unless requested otherwise.

How do I set a fraud alert?

Adding security to your credit is easy if you set a fraud alert. You can set a fraud alert on your credit by contacting one of the credit bureaus. There is no need for more than one to be notified of the fraud alert.

I found out that my credit card number was stolen.

What is a credit freeze?

Your credit report can't be accessed if you have a credit freeze. Unless you temporarily lift the freeze, you won't be able to open a new account. It's inconvenient, but it will make it harder for a fraudster to open new lines of credit in your name.

Even if you have a freeze on your credit report, you can still do things like purchase an insurance policy, rent a new apartment or apply for a job without having to lift the freeze.

A credit thaw is when a credit freeze is lifted.

How do I freeze my credit?

A credit freeze requires you to contact each of the credit bureaus separately.

Provide your name, address, birth date, and Social Security number. You may need a photo ID or piece of mail at your current address.

How do I unfreeze my credit?

Lifting the credit freeze is the first thing you have to do when applying for new credit. If you don't lift your credit freeze, the card issuer or lender won't be able to access your credit information when it processes your application, and you'll almost certainly be denied

If you don't know which credit reporting agency a card issuer will use when you apply for new credit, you'll need to lift your freeze with all three of them. You can either choose a temporary lift or permanent lift.

You can decide if you want to suspend the freeze for a certain period of time or not. The freeze is back into effect after the dates have passed. When you need to lift your credit freeze, this is a great way to do it without having to remember to do so.

If the credit freeze was put in place to protect you from identity theft, you should think about removing it permanently.

If you forget to lift your credit freeze after applying for a credit card, thaw your report and call the reconsideration line. When I applied for a new credit card, I made a mistake. Once I thaw my report, Chase approved me for a new account with a great sign up bonus.

It's possible that you want to invest in a credit-monitoring service.

Bottom line

A credit freeze or fraud alert can help you prevent someone from opening a credit account in your name. You have to keep an eye on your credit accounts. It is important to check your credit reports frequently to make sure they are free of errors. You have the right to request another free credit report if you place a fraud alert.

If you want to apply for new credit, you have to wait a bit longer. It's worth the effort to keep your credit safe from bad guys.

Emily Thompson reports additional reporting.