What You Need to Know About Credit Freezes When Buying a Home

By
Mortgage and Lending with NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 IL Lic 031.0006220/WI
https://activerain.com/droplet/5gMJ
 
 
What You Need to Know About Credit Freezes
When Buying a Home
 
 
Currently, I'm working with clients that had chosen ... prior to their mortgage application ... to place a Credit Freeze on their credit file and credit accounts ...

They had decided to take that action after the discovery of 2017's major Equifax Credit Breach.  In that breach, hackers gained access to consumer's Social Security numbers, names, addresses, and birth dates.  

In a number of cases, these hackers also stole driver's license numbers, as well.  And in a much smaller number (but still sizeable), other varying identity info was also stolen during that breach.  

Pretty scary stuff when you consider the huge number of people that conduct personal banking and business online via their computer or cell phone.  Their decision (and many others) to place a Freeze at that time is pretty understandable.

But what security protections are actually found by consumers like my clients when they place a Credit Freeze on their credit file/credit accounts?  
 
First, it's important to know:

  1. What a Credit Freeze is  
  2. What it will and will not do regarding access to your personal financial and credit information 
  3. How (and where) protections are put into place via Credit Freeze  
  4. If it's ever prudent to remove a Credit Freeze, either permanently or temporarily

 

A Credit Freeze:

  • Is a tool that restricts access to your Credit Report
  • Is NOT the same as a Fraud Alert
  • Does NOT affect your Credit Score
  • Does NOT limit your ability to receive your Free Annual Credit Report
  • Makes it harder for identity thieves to steal and use your personal information to open new credit accounts in your name.  

      Remember:  It's still vitally important that you continue to monitor your current existing accounts for irregularities, errors, and fraud.    

  • Thanks to the Economic Growth, Regulatory Relief, and Consumer Protection Act, placement of a Credit Freeze no longer has a small fee associated with it.  Neither does the lifting/removal or "thawing" of a Credit Freeze.
  • Must be placed at each of the 3 Major Credit Bureaus (ExperianTransUnionEquifax.  Each Bureau requires that you set-up an account, perhaps requiring a PIN.)
  • Does NOT apply to your current creditors.  They (and their designated agencies, such as debt collectors) remain able to access your credit info/report
  • May not apply to other governmental agencies in instances such as subpoenas, warrants, etc.
  • Does NOT protect you against everything, such as fraudulent activities perpetrated as a result of information gained through other means, i.e. stolen Social Security Numbers/Cards, etc.

 

If you decide to place a Credit Freeze, you must be prepared to provide all/some of the following info:

       *  Your Name

       *  Your Date of Birth
       *  Your Social Security Number
       *  Your Address

       *  Possibly other personal info

        
A Credit Freeze can be permanently removed from your credit file and credit accounts.  But it's also possible to remove a Credit Freeze temporarily or for specific inquiries or designated periods of time.  

 

My mortgage clients provide a good example of when it's necessary and wise to lift or remove (sometimes called "thawing") a Credit Freeze.


By temporarily lifting their Freeze, they made it possible for their mortgage process, including the running and examination of their credit and credit history, to proceed smoothly and in a timely manner.  

 

It's prudent to point out here that the Credit Freeze lift/removal must be in place at 2 points during the mortgage process.  First for initial credit run and inquiry for Approval and Application ... and then again just prior to Closing, as most lenders run a second credit check within 10 days of Closing.

In my clients' circumstance, that was the reason for our conversation together over the past weekend.  My call contained a reminder that the Credit Freeze lift/removal would need to be in place for their required upcoming Closing credit check.  It was something they were more than happy to hear and see to.

Other instances where a lift or removal of a Credit Freeze might be needed are:

  • During a new employment application. Some employers conduct a credit check of applicants at this time.  (If your potential employer is performing a check, it might be helpful to find out which if the Credit Bureaus they utilize for this purpose.  Otherwise, you will need to lift the Freeze at all 3 Credit Bureaus)
  • Application for service with a Utility Company
  • Application for service with a Cell Phone Company
  • Renting an apartment or home
  • Application for new credit
  • Application for a new credit card 

 

Remember the old saying, "Timing is Everything"?  It definitely applies when considering the lift or removal of a Credit Freeze.
 
Why? 
 
A lifting/removal can take as little as minutes ... or days.  So make sure you know and understand the time allotment needed to ensure a swift and favorable outcome for yourself.
 
This is also an opportune time to highlight 2 things of great importance.  It remains vitally important that you: 
  1. Not develop a sense of false security regarding your Credit Freeze
  2. Make it your habit to check your Credit Report on a consistent basis.  (I recommend that you check your Credit Report for accuracy, at a minimum, once per year.)  

 

It's especially important to check your credit and monitor your accounts prior to applying for a mortgage loan.  I urge anyone hoping to buy or refinance a home to do so well before making application ... at least 6 months to a year.  Note:  Having a proactive credit/financing conversation with me at this time is also a very wise action. 
 
Placing a Credit Freeze on your credit file/credit accounts can be a helpful tool in the prevention of credit fraud.  But the pros and cons, as they affect you and your personal credit, must be carefully weighed prior to taking action.
 
Should you have questions regarding any of the above ... or should you need answers or assistance with New Lenox - Chicagoland/IL - WI mortgage financing, please do not hesitate to reach out to me.  I'll be happy to assist ... 
 
 
* Looking for financing answers, options, solutions, and experienced assistance? 
 
Are you hoping to Buy, Refinance or purchase an Investment Property in New LenoxWill County, or elsewhere in the Chicagoland area? 

Contact me!  I'll put my 40+ years of Mortgage experience and expertise hard to work on your behalf.
I'm easily found at:


Gene Mundt
 
Mortgage Originator -NMLS #216987 - IL Lic. 031.0006220 - WI Licensed
 
American Portfolio Mortgage Corp.
NMLS #175656
 
 
Direct: 815.524.2280
Cell/Text: 708.921.6331
eFax: 815.524.2281
 
 

 

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Gene Mundt

 Mortgage Originator  -  NMLS #216987    

                                 IL Lic. #031.0006220  -  WI License #216987                                                                                                    

NMLS #175656

 

Gene Mundt, Mortgage Originator,  40+ years of #mortgage experience, will offer you exemplary mortgage service and advice when seeking:  #Conventional, #FHA, #VA, #Jumbo, #USDA, and Portfolio Loans in #Chicago and the greater Chicagoland region, including:  The #Lincoln-Way Area, #Will County, (#New Lenox, #Frankfort, #Mokena, #Manhattan, #Joliet, #Shorewood, #Crest Hill, #Plainfield, #Bolingbrook, #Romeoville, #Naperville, #Wilmington, #Peotone, etc.), #DuPage County, the City of Chicago, #Cook County, and elsewhere within IL and Wisconsin. 

 

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Re-Blogged 6 times:

Re-Blogged By Re-Blogged At
  1. Debra Leisek 01/09/2019 12:26 AM
  2. Karen Feltman 01/09/2019 10:46 AM
  3. Cynthia "Cyndi" Cook 01/09/2019 01:14 PM
  4. Ginger Harper 01/09/2019 01:41 PM
  5. Margaret Goss 01/10/2019 01:00 PM
  6. Gabe Sanders 01/26/2019 11:00 PM
Topic:
Lending / Financial
Location:
Illinois Will County New Lenox
Groups:
Mortgages
Home & Credit Savvy
Buyer Information - What Buyers Need to Know in Today's Market
Bananatude
WillCounty
Tags:
internet security
fraud
credit history
scams
mortgage process
credit freeze
financial account protection
home buying advice and tips

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Rainmaker
2,703,376
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

They can really throw a monkey wrench into things if you’re not careful, you’re totally right.

Jan 08, 2019 11:32 PM #8
Rainmaker
2,703,376
Laura Cerrano
Feng Shui Manhattan Long Island - Locust Valley, NY
Certified Feng Shui Expert, Speaker & Researcher

I’m seeing more of it to be sure! You’re definitely not alone in this phenomenon here. It’ll be interesting to see what happens in the next year, Scott Godzyk

Jan 08, 2019 11:33 PM #9
Rainmaker
598,826
Debra Leisek
Bay Realty,Inc Homer Alaska - Homer, AK

This is very good information for those who did the FREEZE... thank you!!

Jan 09, 2019 12:10 AM #10
Rainmaker
223,956
Dale Taylor
Re/Max 10 New Lenox Illinois - Frankfort, IL
Realtor = Chicago Illinois Homes Townhomes Condos

Hey Gene happy new year. This is excellent information. Thanks

Jan 09, 2019 12:19 AM #11
Rainmaker
3,720,532
Dorie Dillard CRS GRI ABR
Coldwell Banker United Realtors® ~ 512.750.6899 - Austin, TX
Serving Buyers & Sellers in NW Austin Real Estate

Good morning Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi ,

Excellent post and so glad to see it featured. I do see persons with higher credit scores watching what is going on, checking their scores and the most likely candidate to place a freeze on their credit.

Jan 09, 2019 04:11 AM #12
Rainmaker
1,155,529
Lorrie Semler, REALTOR® in the Dallas area. Call/text 972-416-3417
United Real Estate - Addison, TX
Real Service. Real Results. Real Estate

I have a credit freeze in place. When it was time to get a new cell phone, because of the freeze, I couldn't use the option of paying it off monthly as part of my cellular bill, even with the same carrier, due to the credit freeze. I went home, removed the freeze, went back a day later to get the phone, and the freeze still hadn't been lifted. Rather than make a 3rd trip to the Apple store, I just paid for the phone in full. You provided great information. Thank you.

Jan 09, 2019 04:33 AM #13
Rainmaker
2,070,010
Sharon Tara
Sharon Tara Transformations - Portsmouth, NH
New Hampshire Home Stager

A well deserved feature Gene. I had no idea on any of this. Very informative and very helpful!

Jan 09, 2019 06:21 AM #14
Anonymous
Joe Emmet

Hi Gene,

Thank you for the detailed information you provided.

You can expect many more people to put a credit freeze on their accounts after the recent Starwood breach.

It is easy to remove a credit freeze temporarily, or permanently.

Given the frequency with which these hacks are occurring, my wife and I decided to leave ours on permanently because it is more time consuming to initiate the freeze then it is to temporarily remove it.

Better safe than sorry.

As you said, keep monitoring your accounts regularly.

Jan 09, 2019 09:15 AM #15
Rainmaker
525,830
Karen Feltman
Cedar Rapids/Iowa City, IA KW Legacy Group - Cedar Rapids, IA
Relocation Specialist in Cedar Rapids, Iowa

Great information Gene! Well deserved feature and I even reblogged it! Thank you for sharing 

Jan 09, 2019 10:49 AM #16
Rainmaker
3,101,620
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

ahhh but of course...excellent "defrosted" information Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi  !!!

Jan 09, 2019 11:56 AM #17
Rainmaker
22,633
Cynthia "Cyndi" Cook
Keller Williams Realty Alabama Gulf Coast - Orange Beach, AL
Residential Real Estate Sales and Vacation Rentals

Hey Gene! Thanks for all the great information! 

Jan 09, 2019 01:13 PM #18
Rainmaker
291,556
Elisa Uribe Realtor #01427070
Golden Gate Sotheby's International - Oakland, CA
California Homes for Sale in the East Bay

Hi Gene! This is a great article to share to my clients! Thanks for sharing!

Jan 09, 2019 02:27 PM #19
Rainmaker
1,045,655
Margaret Goss
Baird & Warner Real Estate - Winnetka, IL
Chicago's North Shore & Winnetka Real Estate

I've heard of credit freezes but wasn't sure about the purpose. I would love to reblog this post - thank you!

Jan 10, 2019 12:54 PM #20
Rainmaker
469,496
Bruce Kunz
C21 Solid Gold Realty, Brick, NJ, 732-920-2100 - Howell, NJ
REALTOR®, Brick & Howell NJ Homes for Sale

Thanks for sharing this information, Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi.  I froze mine 'a while ago' and do appreciate a better understanding of what I've done.
Bruce.

 

Jan 10, 2019 06:58 PM #21
Rainer
12,100
Carol Lozito, P. A.
K Company Realty LLC - Pompano Beach, FL
Fla. Probate Realtor & Waterfront Home Specialist

Excellent article on Credit for consumers.  Shared it on my Linkedin and Facebook sites.

Jan 11, 2019 07:54 AM #22
Rainmaker
14,799
Mary Grace (Ballew) MacDougall
Keller Williams Columbia - Columbia, SC
Home Buying and Selling in the Columbia Area

Great information! I had clients that froze their credit for the same reasons and didn't realize it would take a few days to clear up. Will keep this in mind for the future!

Jan 11, 2019 08:46 AM #23
Rainmaker
615,948
Mike McCann - Nebraska Farm Land Broker
Mike McCann - Broker, Mach1 Realty Farmland Broker-Auctioneer Serving Rural Nebraska - Kearney, NE
Farm Land For Sale 308-627-3700 or 800-241-3940

Great info. We were hacked a few years ago and use a credit freeze on our account. Although I think it is a great tool to use I also notice it does not slow down the solicitation for business or the scammers. Thank you for sharing.

Jan 12, 2019 08:57 AM #24
Rainmaker
959,680
Jan Green
Value Added Service, 602-620-2699 - Scottsdale, AZ
HomeSmart Elite Group, REALTOR®, EcoBroker, GREEN

Excellent post Gene!  You've inspired me to write a new post as to the steps to get ready to buy a home - 6 months out check your credit..... 

Great advice for anyone looking to knowWhat you Need to Know about Credit Freezes! 

Jan 14, 2019 05:55 PM #25
Ambassador
3,859,337
Jeff Dowler, CRS
Solutions Real Estate - Carlsbad, CA
The Southern California Relocation Dude

Hi Gene:

Glad to see this well-done post featured so more will read it. There is some terrific advice and education here that buyers and would-be buyers need to know about.

Jeff

Jan 15, 2019 09:48 PM #26
Rainmaker
4,791,413
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Thanks for the information, Gene.  I currently have credit freezes in place for myself and my wife.  I didn't know we could remove the freeze temporarily.

Jan 16, 2019 05:33 AM #27
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Rainmaker
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