Credit Unfreeze – An Ultimate Guide in 2023
One of the three major credit bureaus suffered a massive breach of data that led consumers to understand the importance of a credit freeze. A credit freeze makes your credit report inaccessible to lenders or anyone else, so you are not at risk of getting your identity stolen or becoming a victim of credit fraud. But, there are certain reasons you need your credit unfreeze.
I am Damon DeCrescenzo and as the Founder of The Credit Pros, I am here to answer all your questions about how and why you may want to unfreeze your credit using my years of experience as a credit advisor.
Let’s get into the topic without further delay.
What Is a Credit Unfreeze?
To know what it is to unfreeze your credit, you should first know what a credit freeze is. Basically, a credit report is what the lenders look at before making decisions to approve your loan or credit card and determine whether you can handle more debt or not.
So, a credit freeze just as the name suggests freezes your credit for security purposes and makes it inaccessible to lenders or anyone else. Lenders will most likely deny your application without having access to your credit, but the main purpose of a credit freeze, also known as a security freeze, is to protect your credit from identity theft.
Credit freezes add an extra layer of protection to your account from being used by a thief to open new accounts or a new line of credit in your name.
How Do You Freeze Your Credit?
It is a simple process but takes time if you don’t have an online account in each of the credit bureaus. So, if you are going to log in for the first time follow the instructions on the bureau’s online webpage to create an account. Follow the same with other credit bureaus and once you are done creating an account, you can request online for a credit freeze in each bureau either online, by phone, or by mail.
How Do You Unfreeze Your Credit?
If you freeze your credit temporarily but are planning to apply for a new loan or credit, you must unfreeze your credit report to avoid being denied or receiving high-interest rates. This process is known as “thawing” your credit.
Thawing your credit doesn’t take much time if you already have online accounts on each credit bureau. Log in to each account separately and apply for a permanent or temporary credit unfreeze, whichever is more suitable for you.
Whether applying online or by sending a mail, you can follow the directions given by the credit bureau to unfreeze your credit.
What Are the Reasons for a Credit Unfreeze?
If you have a credit freeze for security purposes, you can always request a credit unfreeze once the threat has passed.
- When You Apply for a New Loan or Credit Card
If you plan on getting a new loan or credit card, you must unfreeze your credit. If your credit report is not accessible to your creditor, chances are that you will get disqualified from the approval process of the credit or loan application, or you might get the credit with a high-interest rate.
- When You’re Looking for a House or Apartment
You will most likely go through a credit check if you are new house or apartment hunting. Whether or not you are renting or buying, it is better to unfreeze your credit for the time being.
- When You’re Planning to Purchase a New Phone
Unless you are paying for the phone in cash, you will have to go through a credit check, so it is better to keep your credit account open for them to check. Most cellphone providers may allow you to pay for your phone in installments without any interest. But they’ll check your credit before that. This also applies to non-prepaid phone services.
- When You’re Looking for a Job
Unfreezing your credit report is necessary if you’ve started searching for a job, or are up for a promotion. A credit agency might conduct an employment credit check for financial or higher-level positions in management, or for positions where you’ll be required to deal with a lot of money.
What Are Ways to Unfreeze Your Credit?
Just as you separately requested a credit freeze from each of the credit bureaus, you should request a credit unfreeze in the same way from each of the credit bureaus. There are two methods of unfreezing credit, which are:
- Temporary Credit Unfreeze – You can schedule a temporary unfreeze on credit to let creditors check your credit score when you need to take out a loan.
- Permanent Credit Unfreeze – This unfreezes your credit permanently until you request another credit freeze.
Is There Any Cost to Unfreeze Your Credit?
According to the federal government, the three major credit reporting agencies should let consumers freeze and unfreeze their credit online for free. Freezing and unfreezing your credit can be done anytime for free, it may be online, by mail, or by phone.
How Long Does It Take to Unfreeze Your Credit?
It takes 3 business days maximum if you request a credit unfreeze by sending mail to the credit reporting bureaus. If you request online or by phone for a credit unfreeze, then it takes no more than one hour.
Pros and Cons of a Credit Freeze and Unfreeze
Now that we’ve seen what is credit unfreeze, and why and how credit unfreezes is done, now let’s see some of the benefits and drawbacks of freezing and unfreezing your credit.
- No Cost – The consumers are free to freeze and unfreeze their credit according to the federal government in 2018.
- Identity Theft Protection – Credit freezes prevent thieves from accessing your credit and opening new accounts, or new lines of credit in your name, since lenders can not approve any loans without seeing your credit score.
- Simple and Quick – According to federal law, the three major credit bureaus are required to maintain a web page where consumers have access to request a credit freeze or credit unfreeze easily. The government has imposed that credit unfreezes should be done by the credit bureaus within a specific time.
- Protection From Credit Bureaus – There are chances that your information can be leaked to potential lenders by a credit bureau without your authorization. The credit freeze prevents a credit bureau from sharing your account information with any other party. So, you are free from annoying pre-approval offers for credit cards. But, some of them still find a way to sneak in, but you can call 888-5OPTOUT (888-567-8688) to opt out for free.
- Time-Consuming – Even though online accounts provided by the three major credit bureaus make it easy to freeze and unfreeze credit, it can be a bit of a hassle and time-consuming process to login into each one of the websites. However, it is still better than dealing with credit fraud.
- False Sense of Safety – Although your freezing your credit protects them from thieves, it is not safe if someone finds your social security number or your account number with malicious intentions. So, even if you security freeze your credit report, you need to monitor your account closely to prevent theft or fraud.
- Higher Insurance Rates – You have the chance of getting a higher interest rate because of a credit freeze since the lenders decide the interest rate based on your credit score. So, it is better to unfreeze your credit report if you plan to get a loan.
- MySocialSecurity Account Limitations – There is an online account, called MySocialSecurity, that the government lets you open up for the purpose of tracking future benefits and earnings. You will have to temporarily unfreeze your credit report to do that.
Unfreeze Your Credit Whenever You Want
Freezing and unfreezing your credit doesn’t cost you anything, doesn’t affect your credit score, or makes many changes at all. So, for security and safety purposes you can keep your credit in the freeze, then unfreeze it whenever you want.
Even if your credit is in freeze make sure you have your personal account details, like your Social Security Number, PIN, account numbers, and other information protected at all times.
You may visit The Credit Pros for more financial and credit information and updates. You can also contact us at 1-855-339-4464 for credit repair services.
Frequently Asked Questions
- Does a credit freeze affect your credit score?
No, credit freezes do not affect your credit score or credit report in any way.
- What is the downside of freezing your credit?
The downsides of freezing your credit are:
- It is time-consuming.
- Gives you a false sense of safety.
- The insurance rate gets higher.
- Account limitations on MySocialSecurity.
- Is it better to freeze your credit or lock it?
Freezing and unfreezing are free, but you need to have a paid subscription to lock your credit. Unlike a credit freeze, credit lock alerts you of any attempts made to access your credit without your authorization. Unlocking credit is much faster than a credit unfreeze.