5. Fraud Alerts + Security Freezes

Welcome everyone. Kenney Conwell here and the purpose of this module is to walk you through fraud alerts and security freezes. So that way you know, and understand how they work with credit. So this is an important step that a lot of people either missed or they don’t do, or they just don’t understand. So here’s what we’re going to cover: number one, I’m going to break down what a fraud alert is and really why you want to have it on your credit file moving forward. Number two, I’m going to break down what security freeze is and that way you understand the difference between the two and when, and how to apply the two and not in this particular video, but right below this video and inside of this module, in the resource section, there is three cheat sheets and those cheat sheets walk you through step-By-Step how to add and remove a fraud alert, and also a security freeze with that specific bureau.

So you want to take a look at those cheat sheets and follow the instructions step-by-step in order to do that. All right, so let’s go ahead and hop right in. So what is a fraud alert and when should you do it? So really fraud alerts because of the identity theft that has been rampant in our country. The last, I would say 10-15 years, essentially the FTC put together a strategic way to prevent identity theft thieves from going out and applying for credit without your knowledge. So what a fraud alert does is it notifies potential creditors and lenders that you’ve been, or you suspect you’ve been a victim of identity theft or fraud. So even if you haven’t been, or you think you have been because it happens so much, it’s kind of a good idea to place this on your reports, not necessary, but it’s kinda like a good idea only because it puts an added layer of security before anybody can apply for credit.

So if you’re going through this process, which you are the credit repair process, you really don’t want to be applying for any additional credit. And as you’re repairing and rebuilding and getting your glass cleaned, you don’t want to have any random acts of identity theft, kind of throw a monkey wrench in your progress. So you want to go and do that. And when you have a fraud alert on your credit file, businesses and lenders, they must verify your identity first before issuing credit. So what will happen is you’ll apply an application. Typically the inquiry won’t even show up on your credit report unless you first verify your identity. So what happens is, in order for them to do that, they’re going to ask you to send any additional, typically they’re going to ask you to send additional verification documents, depending upon the business or the lender, things like your driver’s license, your passport, or your social security card, maybe even a proof of address, just so they can verify that you are who basically, so they can verify that this is actually you.

And then sometimes you can place your phone number on file with the credit bureaus. So that way, when you’re going, just to say, to apply for a Chase card or Bank of America card, or whoever you’re trying to apply for, that bureau or that creditor can see the phone number on file and they can text or call you to say, Hey, look, do you authorize this application for credit? Then you can just simply text back. Yes. Or you can simply say yes, and that really puts an added layer of protection against any additional person that’s going to go out and apply for credit for you. So if you know, you’re getting ready to go out and start applying for a lot of credit, you can remove the fraud alert, but it’s really, really good practice to go ahead and place this on here.

Just to kind of have more control and more peace of mind, so to speak over what’s happening and what’s being done on your credit file. Again, it doesn’t prevent anybody. It’s really is an extra layer. That’s really the moral of the story, it’s that insurance. So a security freeze is totally different. So a lot of people get security freezes mixed up with fraud alerts and really what a security freeze is, this is a security measure that prevents any potential new lenders from accessing your credit file without the freeze being lifted by you. So essentially no one can view your credit report except you. So when you place a freeze on your report, and somebody wants to apply for credit or view, they can’t even view your credit report. So typically when you do a freeze, you’re going to do a one year freeze or seven-year extended freeze.

And the only reason why you would do a freeze is if you know you’re going to be out of the country for three months, six months, and you already know for sure, you’re not going to be using your credit. So this is like the end all be all when it comes to not allowing anybody to access your credit. So typically if you’re in the military, you know, you’re going to be deployed. You can do an active duty freeze. And again, you don’t necessarily need to freeze your file if you’re at a place where, you know you’re going to be applying for credit, but you just need to understand the difference between the security freeze and the fraud alert. Typically, depend upon the bureau and who you’re placing this with, you can do the fraud alert once or you can do fraud alert, and then once you’ve done the fraud alert, you can go and you can do security freeze, but there’s really no need to have both of them.

You’re either going to do the fraud alert because you know, you’re going to be actively still wanting to apply for credit, but you just want to have that added layer of security to be notified, to have them verify your identity, or you’re not going to be applying for credit at all and you just want to go ahead and place a freeze on your file, and you don’t want any type of credit being placed on your file at all. So if you’re going through the credit repair process and you know for a fact, you don’t want to have any credit applied, you can place a freeze on it. I don’t suggest you do that only because if you’re going to be following our program, there is going to be some accounts that we suggest that you get. And when you have a freeze on your report it’s not going to allow those.

It’s not going to allow you to get that credit, so to speak. So, that is the difference. So right below this video in the resource section, you will see three PDFs. One is a cheat sheet for Experian. The next is a cheat sheet for TransUnion and Equifax and depend upon which, well you can use all three. They all three have their own portals and their own specific ways that you have to access this. So in a previous module, I showed you to pull your credit report, Experian and TransUnion, that username and passwords more than likely going to be the same Equifax, isn’t going to be the same. So you’re going to have to create an account with Equifax and I’ll show you step-by-step how to do it in the video. Okay. So that is it. And I will see you in the next module.