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

Reblogger Cynthia "Cyndi" Cook
Real Estate Agent with Keller Williams Realty Alabama Gulf Coast
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.
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


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Gene Mundt, IL/WI Mortgage Originator - FHA/VA/Conv/Jumbo/Portfolio/Refi
NMLS #216987, IL Lic. 031.0006220, WI Licensed. APMC NMLS #175656 - New Lenox, IL
708.921.6331 - 40+ yrs experience

I appreciate you sharing this info, Cynthia "Cyndi" Cook ... thank you!  Hope it proves informational and motivational to your readers ...


Jan 10, 2019 09:15 AM #1
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Cynthia "Cyndi" Cook

Residential Real Estate Sales and Vacation Rentals
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