Requesting a credit report freeze provides an important weapon in fighting identity theft, because it prevents a lender from pulling a credit report -- something almost all creditors require, according to the Consumers Union. A credit report freeze can block your FICO score from most requests to see your credit history.
Function
A credit report freeze blocks any new lender from looking at your credit history and score, according to Experian. The lender instead receives a code signifying a blocked report. Anyone else who might want to see your credit score, such as an employer, utility company or even yourself, cannot pull your credit report. The credit reporting agencies will still update your report with new information.
Current Lenders
Nothing stops current lenders from looking at your FICO score, according to MSN Money Central. If you wanted to, for instance, raise your credit limit, a credit report freeze would not impede your ability to do so.
Lifting the Freeze
You can temporarily allow lenders to view your credit report even after instituting a permanent freeze by setting up a personal PIN or password, according to MSN Money Central. To lift a credit report freeze, you will have to contact all three credit reporting bureaus and ask them to temporarily lift the freeze and give them your PIN or password.
Fraud Alerts
You will have to pay a fee -- between $10 and $12 depending on your state of residence -- to freeze your credit report, according to MSN Money Central. Alternatively, you can get a fraud alert for free and all it takes is a phone call. A fraud alert requests the lender viewing the report to verify the identity of the applicant. The downside is that lenders can essentially ignore fraud alerts because the law does not dictate what constitutes reasonable measures to verify identity. Also, fraud alerts only last 90 days, while credit freezes can last a lifetime.
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