Credit FREEZE vs. a Credit LOCK

Consumers Union is recommending consumers place a Credit FREEZE vs. a Credit LOCK.  Here’s Why…

A credit LOCK is simply a contractual business agreement between you and the Credit Bureau. 

Having a contractual agreement is not nearly as strong as having protections under the law. A contractual agreement with a company is subject to change, or may be unclear. It may include provisions that you may be better off NOT agreeing to – such as binding arbitration. With LOCKS, it’s also not clear who would be liable for financial losses.

A Credit FREEZE is the better option, because a credit freeze offers stiffer legal protections.

Its promise to guard your credit accounts is guaranteed by law! If something goes wrong, and your credit accounts are fraudulently accessed, consumers are protected from financial liability.

Credit Freeze vs. a Credit Lock
A Credit Freeze is better than a Credit Lock

BUT – In response to the stampede of people attempting to place a Credit Freeze, after the massive Equifax breach, the 3 Credit Bureaus are pushing consumers to “LOCK” their credit files instead of placing a Credit “FREEZE”.

Just To Be Clear: The best way to protect yourself from an identity thief opening a credit account in your name, is still by placing a credit freeze at all three credit bureaus.

Consumers should be wary of this push towards Credit “Locks”. Equifax and the other two credit bureaus fought for years against our right to freeze our credit reports – and then demanded fees to do so.

Equifax has said it will be offering a new type of credit “LOCK” FREE – for life. This raises questions and concerns about their motives! Credit Bureaus make huge sums of money by selling your information and allowing access to your credit file.  A credit FREEZE will greatly limit their ability to do so.

So if you are offered a choice between a Credit Freeze vs a Credit Lock, don’t let the Credit Bureaus try to fool you. A Credit Freeze has always been the best way to keep the bad guys from getting credit in your good name. A credit LOCK is designed to work in the best interest of the Credit Bureaus – NOT YOU!

“We are still trying to figure out why they are pushing this newer thing they call a credit “lock” says Mike Litt at U.S. PIRG (Public Interest Research Group). “It may allow credit bureaus to market to consumers more aggressively for products that they may not need and/or shouldn’t pay for”.

It’s time for Congress to provide free Credit Freezes. To learn more go here: http://www.uspirg.org/news/usp/interactive-map-shows-consumers-42-states-have-no-access-free-credit-freezes 

You can also read one of my previous articles about the Equifax Data Breach