Credit Freezes and Fraud Alerts: What Each Does
A credit freeze and a fraud alert are often mentioned in the same breath, and they do different things. One stops new accounts being opened at all; the other tells lenders to check with you first. Both are free, both are yours to place without anyone's permission, and one of them will quietly block your own loan application if you forget it is there. Here is what each actually does, taken from the Federal Trade Commission's guidance rather than from a credit monitoring service that would rather sell you something.
What a Credit Freeze Does
The FTC states it plainly: when a credit freeze is in place, nobody can open a new credit account in your name. That is the whole point, and it is the strongest of the free protections available to you. There is no cost to place or lift a credit freeze, and it does not affect your credit score.
You do not need to have been a victim of anything to use one. Anyone can freeze their credit report, for any reason, even if their identity has not been stolen — and a freeze lasts until you lift it, rather than expiring on a schedule you have to remember.
The sentence people miss: while a freeze is in place, nobody can open a new credit account in your name, including you. A frozen file does not politely make an exception for applications you made on purpose. If you apply to refinance, rent an apartment or buy insurance with a freeze on, the lender simply cannot pull your file, and the application stalls with no obvious explanation.
Lifting It Before You Apply for Anything
A freeze is temporary whenever you need it to be. If you need to do things like apply for new credit or a job, rent an apartment, or buy insurance, you can temporarily lift the freeze and put it back when you are done. Lifting costs nothing, exactly as placing it does.
The FTC's practical tip is worth following rather than lifting everything: identify which bureau a lender will use to check your credit and just lift the freeze at that one bureau, then put the freeze back in place once the need for a credit check passes. Ask the lender which bureau they pull — they know, and it is a normal question.
This matters more than it sounds if you are shopping a loan. Comparing offers means several lenders pulling your file in a short window, and a freeze left on at the wrong bureau turns a clean comparison into a series of unexplained declines.
How to Place One
A freeze has to be placed at each bureau separately. Contact all three of the credit bureaus — Equifax, Experian, and TransUnion. This is the opposite of how fraud alerts work, which is the single most common point of confusion between the two.
What a Fraud Alert Does Instead
A fraud alert does not lock anything. Fraud alerts make lenders verify your identity before they grant new credit in your name, and unlike a credit freeze, a fraud alert does not prevent businesses from seeing your credit report. You can place one even if you already have a freeze.
The contact rule is the reverse of a freeze, and it saves two phone calls: contact one of the three credit bureaus. You do not have to contact all three, because the credit bureau you contact must tell the other two to place the alert on your report.
The three kinds, and who each is for
- Initial fraud alert — for anyone who is or suspects they may be affected by identity theft. It lasts one year and can be renewed, and placing one entitles you to a free copy of your credit report from each of the three bureaus.
- Extended fraud alert — for people who have experienced identity theft and have completed an FTC identity theft report at IdentityTheft.gov or filed a police report. It lasts seven years and also requires the bureaus to take you off their marketing lists for unsolicited credit and insurance offers for five years, unless you ask them not to.
- Active duty alert — for active duty servicemembers. It lasts one year with the choice to renew for the length of a deployment, and takes you off those same marketing lists for two years.
Which One You Actually Want
If the goal is to stop new accounts being opened, the freeze is the stronger tool and the alert is not a substitute for it. If the goal is to keep applying for things normally while adding a verification step, the alert is the one that lets that happen. They are not alternatives so much as different settings, and the FTC is explicit that you can have both at once.
Neither one repairs anything. A freeze does not remove an error already on your report and an alert does not change your score. If something on your file is wrong, that is a separate job, it is also free, and you do not need to pay anyone to do it.
RefiSolutions is a free matching service; we are not a credit bureau and we cannot place, lift or check a freeze for you. Every step above is something you do directly with the bureaus at no cost. Where we can help is afterwards, once your file is unfrozen and you want to know what it actually qualifies you for.