What’s the Difference Between Fraud Alerts and Credit Freezes?

How fraud alerts work Fraud alerts, sometimes called security alerts, are a type of credit report status that can be issued by the any of three credit bureaus. In order to file an extended alert, you’ll need an identity theft report and a police report indicating that your identity was stolen and/or damage was done to your credit. How credit freezes work Like fraud alerts, credit freezes, or security freezes, also change the status of your credit reports and freezing your credit grants you free copies of your credit reports. It should be noted that you can also temporarily or permanently lift a freeze if you apply for a credit card or other credit account. As you can likely tell from the descriptions, fraud alerts are more of a temporary solution, although they can be extended to accommodate credit monitoring over a longer period of time if you fall victim to identity theft or you’re in the military and deployed. It’s important to note, though, that while fraud alerts can be somewhat useful in stopping new credit accounts from being opened in your name, you won’t be alerted if someone other than you is using your credit. This doesn’t mean that freezes are better – indeed, they can be expensive to create and cancel – but because of their extensiveness, freezes allow you to secure and control your reports better than fraud alerts do. Something to also be aware of is that parents and legal guardians can request a credit freeze for their children to protect their credit until they’re old enough to build their own credit history — placing a fraud alert on your child’s credit isn’t an option. If, for example, you suspect identity theft but can’t prove it, you’ll likely only be able to file an initial fraud alert. This is because initial fraud alerts are available to you at any time, while extended fraud alerts will require an identity theft report.
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By Michael Osakwe, NextAdvisor.com

With identity theft on the rise and news of data breaches popping up almost daily, your credit will likely at some point be the target of fraudsters and identity thieves – assuming they haven’t gotten to it already. This means that you may inevitably face the choice of deciding which tool, a fraud alert or a credit freeze, would best protect your credit. We’ve talked about both credit protection options before, but we’ve never conducted a full-scale comparison between them. Continue reading as we explain what fraud alerts and credit freezes are, as well as when you should use each.

How fraud alerts work

Fraud alerts, sometimes called security alerts, are a type of credit report status that can be issued by the any of three credit bureaus. A fraud alert signals to creditors that your identity might be compromised and that the creditor should take extra precautions to verify your identity before opening new credit accounts under your name or increasing credit limits for any of your existing accounts. A fraud alert filed with any of the three major bureaus is immediately forwarded to the other two bureaus, meaning you don’t have to contact all three major bureaus to initiate the alert — you can just contact one of them. In addition, filing a fraud alert grants you the right to have free copies of your credit reports (outside of your annual free reports). It should be noted that you will not be charged to place a fraud alert.

There are three different types of fraud alerts that can be placed on your credit reports, and each subtly differs from one another:

1. Temporary or initial fraud alert. This is the standard fraud alert that anyone can add to their accounts — even if you didn’t fall victim to identity theft. It remains in effect for 90 days, but can be renewed upon request. This type of alert works best when you suspect that you were potentially a victim identity theft but lack the proof to prove it. They’re also a proactive way of dealing with the consequences of losing your wallet or social security card.

2. Extended fraud alert. If you have been the victim of identity theft and have proof of the theft, you can get a more comprehensive fraud alert known as an extended fraud alert. These alerts last seven years and credit reporting companies are supposed to take your name off of marketing and prescreened credit offers lists for five years. On top of that, extended fraud alerts grant you two free credit reports within 12 months of requesting the alert. In order to file an extended alert, you’ll need an identity theft report and a police report indicating that your identity was stolen and/or damage was done to your credit.

3. Active duty fraud alert. Military personnel who are on deployment can activate a special fraud alert called an active duty alert. This alert lasts for one year and can be renewed…

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