Protecting your credit just got easier.

As of mid-September, a new law that makes it free to freeze your credit went into effect. Prior to the new law, each of the three credit bureaus could charge you if you wanted to put a freeze in place (usually around $10 at each bureau). Then you often had to pay again to unfreeze or thaw your credit if you wanted to do something that required a credit check, like applying for a new loan. However, after last year’s massive Equifax data breach, consumer advocates called on Congress to provide free access to credit freezes.

WHAT DOES FREEZING MY CREDIT DO?

When you freeze your credit, the credit reporting bureaus can’t give any information to someone who makes an inquiry about you. Typically, businesses inquire about your credit when you (or someone posing as you) are trying to, for instance, open a new credit card, buy a car or rent an apartment. The credit check helps the business determine if they want to lend or rent to you, and it can help set your rates and lending terms for loans and credit cards.

When your credit is frozen and the business can’t get any information about you, it stops the process — which means a fraudster will be unable to open an account while using your identity.

WHY DOESN'T EVERYONE JUST FREEZE THEIR CREDIT THEN?

While freezing your credit won’t guarantee safety, it’s a pretty strong defense against identity theft. But remember — you still need to unfreeze your credit if you legitimately want to apply for a loan or line of credit. You do that with a PIN that you get when you freeze it. While it’s not a heavy burden, it does add extra steps anytime you do something that requires a credit check.

You could opt for credit monitoring instead of a full freeze. You can request a free copy of your credit report annually from each of the major credit bureaus, and check it for any activity you don’t recognize. If you find anything suspicious, report it immediately and take steps to lock down your credit through a fraud alert or credit freeze.

You can also pay for a credit-monitoring service, which alerts you about any activity involving your credit report. This can quickly bring a potential problem to your attention — but it’s not preventative, so you won’t know if someone has used your identity until after it happens.

HOW DO I FREEZE MY CREDIT?

If you want to freeze your credit, you need to do it with each of the three credit bureaus: Equifax (1-800-349-9960), TransUnion (1-888-909-8872) and Experian (1-888-397-3742). If you request a freeze, be sure to store the PIN to unfreeze your accounts in a safe place.

Whether or not you choose to freeze your credit, fraudsters could still take advantage of you by getting things like your credit card number(s) or passwords to online accounts. Make sure you’re taking the proper steps to secure your information so that it doesn’t fall into the wrong hands.

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