What Is the Purpose of Freezing Your Credit Report?


Quick Answer

Individuals place freezes on their credit reports in order to restrict access to their personal information, explains the Federal Trade Commission. Preventing identity theft is the most common reason why people place freezes on their credit reports.

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Full Answer

A credit freeze helps prevent identity thieves from opening new accounts on a consumer’s credit report, states the Federal Trade Commission. However, the FTC reports that there is no guarantee that a freeze completely prevents identity thieves from opening new accounts and urges consumers to monitor their credit reports even if they placed freezes on their reports.

People who place freezes on their reports still gain access to a free annual report, indicates the Federal Trade Commission. Consumers still maintain their ability to apply for jobs, open new accounts, buy homes or buy insurance, but they must lift the freeze in order to process any new credit applications or buy a home. A credit freeze does not prevent individuals from receiving prescreened offers, cites the Federal Trade Commission. If people place freezes on their credit reports, certain agencies still maintain access to the reports. Existing creditors, debt collectors, and government agencies with a proper subpoena, court order or search warrant can access a consumer’s credit report.

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