The three nationwide credit reporting agencies in the U.S., Experian, Equifax, and TransUnion, will be required by a new law to allow consumers to “freeze” and “thaw” their credit report for free. Currently, fees vary by state and situation.
The new law, called The Economic Growth, Regulatory Relief, and Consumer Protection Act, will go into effect on September 21, 2018. This law does many things, including changing the rules around credit freezes.
"Currently, credit freezes have to be placed and lifted at each agency individually, and the process can be cumbersome and time-consuming. The number of situations requiring a credit check, like upgrading your cell phone, applying for a job, or signing a new lease, makes freezing and unfreezing your credit inefficient. As a result, many people won’t bother with a freeze unless they believe they are specifically at risk for identity theft," Better Business Bureau's Veronica Craker explained.
Craker says this new law will make the process of freezing and unfreezing your credit much more simple, and free.
"You will still have to do so at each of the three credit bureaus, but they will have online portals that will make the process much simpler. When a credit reporting agency receives an online or phone request to freeze someone’s credit, they have to have it frozen within one day. Requests to unfreeze someone’s credit report must be completed within one hour. This makes it much easier to keep your credit frozen and then only unfreeze when you need to apply for new credit as the changes are free and can be done quickly and easily online," Craker explained.
Craker says a security freeze prevents the credit reporting agency from releasing your credit report while it’s in effect. Consumers are given a PIN or password that they must have in order to later thaw their credit report so it can be released again. The new law also allows any parent to freeze their child’s credit. A child’s credit report is especially valuable since it is clean and often not monitored regularly.
The new law also extends initial fraud alerts on your credit report from 90 days to one year, and allows victims of identity theft to place a fraud alert on their credit reports for 7 years.
For more resources, visit www.bbb.org.