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News: Credit Freeze VS Fraud Alert: Which To Choose -

Credit freezes and fraud alerts can be extremely useful when you need to protect yourself from identity theft or prevent further misuse of your personal information if it was stolen. However, a fraud alert and credit freeze are not the same thing.

A fraud alert is a notice added to your credit file to tell potential lenders to verify your identity (typically via a phone call) before extending new credit. It is enough to contact one of the major credit bureaus (Equifax, Experian or TransUnion) to place a fraud alert with all three. You'll have three options when you place a fraud alert:

  • Standard fraud alert: a free service for anyone who suspects fraud. The fraud alert expires in one year and can be renewed.
  • Extended fraud alert: a free service for people who have had their identity stolen and completed an FTC identity theft report at or filed a police report. The extended fraud alert lasts seven years and allows you to review your credit report six times in a year for free.
  • Active duty alert: a free service for active duty service members. The active duty fraud alert lasts one year and can be renewed for the length of deployment.

Credit freezes are also available to everyone for free, even if your identity has not been stolen. With a credit freeze in place, lenders cannot access your credit report. That means neither you nor others will be able to open a new credit account while the freeze is in place. When you apply for a new credit card or a loan, you can temporarily lift the credit freeze and place it back once approved. To place a credit freeze, you will need to contact each of the three major credit bureaus - Equifax, TransUnion, and Experian.

When you choose between a credit freeze and fraud alert, you can choose to have both, just in case. Credit freeze provides the best protection and you don't need to bother with renewing it. However, if you do not want to freeze and unfreeze your credit every time you apply, the fraud alert is a good choice.