What is a Credit Freeze?

Identity theft is now passing drug trafficking as the number one crime in the nation-with more than 15 million victims every year. Rather than lie awake at night worrying and wondering if your identity has been stolen, you can actually take a simple step to protect yourself...it's called a credit freeze (or, sometimes, a security freeze).

Here's How It Works. When someone tries to open an account in your name, they'll be stopped in their tracks. That's because one of the first things a creditor will do before opening the account is pull a credit report. By having a credit freeze in place, creditors aren't able to pull your credit report. And, since very few lenders will issue credit without first seeing a credit report, identity thieves can't open fraudulent accounts using your name. However, when you want to apply for credit, you can temporarily lift the freeze using a PIN... thus, allowing your legitimate application to be processed.

The Flip Side. It's important to remember that when the freeze is active, you'll have to lift the credit freeze before you can purchase a car, get a new credit card, or refinance a mortgage. For most major purchases, this won't be much of an issue. However, a credit freeze can be problematic if you want to open an instant credit card with a store.

To learn more about these issues and to find out if your state allows credit freezes, visit
www.ConsumersUnion.org/finance/creditfreezeinfo.htm.

Mortgage Interest Rates*

Rates as of Friday, 14th November, 2008:

 

Conforming

APR

Payment per
$1,000

Jumbo

APR

Payment per
$1,000

30-Yr. fixed

6.125%

6.265%

$6.08

6.500%

6.596%

$6.32

15-Yr. fixed

5.875%

6.107%

$8.37

5.875%

6.030%

$8.37

7-Yr. fixed ARM

6.250%

6.391%

$6.16

5.875%

5.967%

$5.92

5-Yr. fixed ARM

5.500%

5.635%

$5.68

5.625%

5.716%

$5.76

3-Yr. fixed ARM

5.500%

5.635%

$5.68

5.500%

5.590%

$5.68

5-Yr. Interest Only

5.625%

5.761%

$4.69

5.875%

5.967%

$4.90

 

 

*Rates are subject to change due to market fluctuations and borrower's eligibility.

Licensed Mortgage Banker, NJ Department of Banking and Insurance. Corporation also services CO, CT, DE, FL, GA, IN, MA, MD, MN, MI, NC, NH, NY, PA, SC, TN, VA, & RI.

 
9 comments • Karl Peidl - Accredited Loan Consultant • November 14 2008 03:14PM

Comments

I was one of the clients who had her portfolio paperwork stolen via transport, so I truly understand the importance of a credit freeze.

Every day the thieves get smarter. I would prefer the freeze to the availability of my credit to someone who didn't take years to build.

Posted by Nancy Larson (Greater Coastal Realty, Inc.) about 3 years ago

Nancy - It's very scary to have your paperwork stolen.  Using a credit freeze is a minor inconvenience compared to the problems identity theft can cause.

Posted by Karl Peidl - Accredited Loan Consultant about 3 years ago

I have heard of a credit freeze before, but didn't really understand it!  Great post, thanks for helping to clarify the information for me.  This info is useful for everyone, not just real estate professionals.

Posted by Real Estate Virtual Assistant & North San Diego County Real Estate Agent (Christine Wade) about 3 years ago

Christine - Thanks for stopping by and commenting.  This is definitely information that could help everyone.  You are welcome to re-blog it if you'd like so more people will see it.

Posted by Karl Peidl - Accredited Loan Consultant about 3 years ago

Thanks, Karl - but I did better than that...I flagged it for a feature!  (I'm still scared of re-blogging, I haven't done it yet! LOL - since you gave me permission, perhaps I will try it with your article!)

Posted by Real Estate Virtual Assistant & North San Diego County Real Estate Agent (Christine Wade) about 3 years ago

Thanks Christine.  I've never had a blog featured before.  I'll give you carte blanch permission to re-blog any of my posts.  Most of my blogs are informative/educational.  The more people we can help educate, the better it makes our entire industry.

Posted by Karl Peidl - Accredited Loan Consultant about 3 years ago

Thanks, Karl!  Good to know!

Posted by Real Estate Virtual Assistant & North San Diego County Real Estate Agent (Christine Wade) about 3 years ago

Hey Karl!  Thanks for the information.  I had heard the term credit freeze but didn't really understand it.  Scary how easily information can be stolen these days!  A credit freeze may be a little annoying if you're trying to get instant credit at a store or somewhere but it would be preferable than having your credit stolen.

Posted by Jenn Neumann Deer Surfside Beach Real Estate (RE/MAX Southern Shores) about 3 years ago

Christine - I'm glad to help.

 

Jenn - You are absolutely right.  I'd take a minor headache from time to time if it means I could avoid a migraine. 

Posted by Karl Peidl - Accredited Loan Consultant about 3 years ago

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