How to Use Credit Freezes

by | Jul 22, 2020 | Credit Reporting

About ten years ago, someone in New York City was able to open a Verizon account in my name and buy a bunch of electronics on credit. The account started showing up on my credit report, and of course, payments were not being made – so, it was delinquent. As I researched ways to prevent being a victim of identity theft again, I learned that I could “freeze” my credit with each credit bureau. What that means is if any merchant (like Verizon) tried to pull my credit in the future, they would receive a notice that my credit was frozen, and they would not open a new account. This tool effectively prevents identity theft, at least on the level of opening new credit accounts.

What I did not anticipate was how much it would help me in improving my credit score.

Credit scores are determined by several different factors. A few of the main ones are the ratio of balances to available credit (lower balances are better), the age of your credit account (older is better), and inquiries into your credit (fewer is better).

I am someone who can be susceptible to high-pressure salespeople. So, before my credit was locked, I would occasionally get pulled into an offer for a store credit card to save 10% or something. Each time I did that, I would get a new account (which would lower the age of my credit) and I would get an inquiry on my credit. Also, once I had that Best Buy card or Kohl’s card, I would be tempted to carry a balance on it (which would increase my ratio of balances to available credit).

Now, if I ever get an offer for a store card, it’s easy for me to say, “Sounds great, but my credit is frozen, so I’ll have to pass.” Once, I forgot about the freeze and I applied for a card. The application was denied because of the freeze. And, it brought me back to my senses that I didn’t’ really need the card.

As I’ve had fewer accounts over the years, it has made it much easier for me to stay on top of those accounts and to keep them paid on time and paid down.

By now you may be thinking, “But, what if I need to get new credit? How can I do that while my credit is frozen?” It’s actually pretty easy. You go to each credit bureaus website and log in and enter a security code that you get when you place the freeze. You can choose to unfreeze it permanently, or you can choose to unfreeze it for a certain time frame and then to have the freeze go back into place (that’s what I do). It’s not hard to remove the freeze, but it’s JUST hard enough that it makes you think carefully before applying for any new credit. And, a little extra thought before incurring new debt is never a bad thing.

So, if you want the peace of mind of knowing that identity thieves will have a much harder time accessing your credit, while simultaneously employing a tool that can help you rebuild your credit score, I strongly recommend credit freezes. Here are the links that will get you started.


Good luck! And, as always, please reach out if you have any feedback or questions.


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