Financial Success - Credit Freeze vs. Fraud Alert

Protecting credit information

Credit Freeze vs. Fraud Alert: Which is Right for You? 

Fraud alerts and credit freezes can be used to keep identity thieves from opening new credit in your name. While both can provide some peace of mind, one may work better for your current situation. Learn more about each to discover which option is right for you!

Fraud Alert – A fraud alert puts a warning on your credit record that requires companies to verify your identity – usually through a phone call – before they open new credit in your name.

Fraud alerts can be placed by contacting one of the three nationwide credit reporting agencies: Equifax, Experian, or TransUnion. The agency you contact must then notify the other two.

Fraud alerts are free, but they only last for one year. They must be renewed annually if you want to continue the service.

Credit Freeze – A credit freeze cuts off all access to your credit report so that nobody can open new credit accounts in your name, until the freeze is lifted.  

Unlike with a fraud alert, to freeze your credit you must contact all three of the credit reporting agencies separately – not just one. However, the freeze stays in place until you decide to lift it with a PIN or password that you receive when you place it.

So which should you use? That depends on your circumstances!

  • Fraud alerts allow you to keep access to your credit, so it may be better for those who anticipate getting a credit card, mortgage, car loan, or other type of credit in the near future.
  • A credit freeze is typically best for people who aren’t planning to take out new credit, such as older adults or young children.

Remember, fraud alerts and credit freezes can be helpful at preventing thieves from opening new credit accounts. They cannot stop or spot suspicious activity on an existing credit account. You should still carefully check your account statements, and report any suspicious activity to your bank immediately.