After decades of State Mandated differences in the ability of consumers to freeze and hence lock their credit, a new US law now allows all Americans to freeze their credit free of Charge. This important change now allows countless Americans new identify theft protections for free.
Your Credit File
A credit file is a collection of data containing all your past and present lines of credit. This file includes amounts owed, delinquencies, total credit extended, and numerous other financial metrics about you and sometimes your family. The credit file is based off of your name, current and past addresses, date of birth, and your social security number. If someone gets hold of all of these pieces of information they may be able to apply for credit cards or other lines of credit in your name.
The Social Security Number the Way it Shouldn’t Be
The social security number that you were assigned was never intended to be used as your national identification number or your credit file number, but it is. Originally created in the 1930s as a method of tracking people’s social security benefits it was the first national number given out in America and hence quickly became the only real national unique number.
That your social security number is tied to your credit file is odd, that someone can in theory walk into a store with your social security number and walk out with a new couch is odder still. Combined with your address and date of birth, these three pieces of information are all that are required to wreak havoc on your credit history.
In the past ten years as the problem of identity theft has grown worse Americans have been turning to one of two methods to protect their social security numbers. Method One is called Credit Monitoring and is done by private firms that charge a monthly or annual fee to notify you of when a credit line has been opened. Method Two is to freeze your credit. Credit freezes involve locking your credit file with a passcode. Only after your social security number is unfrozen or lifted (with the passcode) can a new line of credit be opened. The differences between these two methods are not unlike having…