Fraud Alerts Explained
Table of contents
- What is a fraud alert?
- Will placing a fraud alert affect my credit score?
- When and why should I place a fraud alert?
- Is placing a fraud alert the same as freezing my credit?
- Different types of fraud alerts
- How to place a fraud alert
- 1. Reach out to one of the three main credit reporting agencies
- 2. Request a fraud alert on your credit report
- 3. Request your free credit report
- 4. Let the fraud alert expire (or ask to remove it)
What is a fraud alert? How can a fraud alert protect your credit score? And how should you go about placing one?
We’ll answer each of these questions and more throughout this article.
Let’s dive in.
What is a fraud alert?
Before we jump any further, let’s quickly cover the basics of what constitutes a fraud alert.
In essence, setting one up means you’ve put the onus on a potential lender or creditor to do their due diligence and verify (either in person or by using the designated contact number on your credit report) that the credit application they’ve received is legitimate and authorized by you.
A fraud alert is one of the key protective measures you can take to help protect yourself against identity thieves looking to open fraudulent credit accounts in your name. By giving companies a heads up that they need to be more stringent in vetting the application, you’re making it that much harder for sneaky identity thieves to open more accounts in your name.
It’s important to understand that placing a fraud alert won’t stop your identity from being stolen in the first place. However, they’re a great way to stop criminals from wreaking further havoc on your credit score and finances.
Best of all, fraud alerts are completely free (and easy!) to set up.
Will placing a fraud alert affect my credit score?
Nope! Setting up a fraud alert will not affect your credit score in any shape or form.
When and why should I place a fraud alert?
Fraud alerts are usually intended for victims of identity theft. However, if you believe your personal information, such as your Social Security number, was exposed in a data breach, it’s probably a good time to set one up.
Is placing a fraud alert the same as freezing my credit?
While fraud alerts and credit freezes are both effective ways to prevent credit fraud, they’re two different things entirely.
- A fraud alert requires a creditor (e.g., a credit card company, landlord, insurance company or utility company) to verify your identity before processing a credit application on your behalf.
- A credit freeze blocks any new creditors from viewing your credit history.
If you’re weighing up whether to go for an extended fraud alert or a credit freeze, it’s worth bearing in mind that (since most creditors won’t open an account without checking at least one of your credit reports) you’ll have to lift the credit freeze each and every time you apply for credit.
This can become quite the headache. So with this in mind, it’s probably a good idea to start with a fraud alert and escalate to a credit freeze at a later stage if necessary.
Different types of fraud alerts
There are three different categories of fraud alerts: initial fraud alerts, extended fraud alerts and active duty fraud alerts. Let’s find out more about what these are:
- Initial fraud alert. Starting with the easiest one first. If you’re in any way worried that your personal information might have been compromised as part of a data breach, but you don’t have hard proof that criminals have stolen your identity, then setting up an initial fraud alert is a great way to help put your mind at ease. Also known as a temporary fraud alert, an initial fraud alert stays on your credit report for one year, notifying prospective creditors you may have been a victim of identity fraud.
- Extended fraud alert. If you’re a confirmed victim of identity theft, then this is the best option for you. To set this up, you’ll first need to have filed a report with the Federal Trade Commission or local law enforcement. An extended fraud alert will stay on your credit report for up to seven years, unless you ask to have it removed before the expiration date.
- Active duty fraud alert. This one’s for anyone working in the military. The timeline for the fraud alert can be adjusted to cover the time period you’ll be deployed for. Active duty fraud alerts also preclude you from receiving any pre-approved credit card or insurance offers for two years.
How to place a fraud alert
Ready to place your fraud alert? Here’s what you’ll need to do:
1. Reach out to one of the three main credit reporting agencies
Ask for a fraud alert to be placed on your account with any one of the three big consumer credit bureaus – Equifax, TransUnion or Experian. Each bureau is, in turn, required by the Fair Credit Reporting Act to make the other two credit bureaus aware of the fraud alert you’ve set up. Alternatively, you can use credit and identity theft monitoring services such as Aura or Lifelock to monitor Experian and all the other agencies for your information being used or stolen.
You can do this either over the phone or online for initial and active duty alerts:
|Equifax||Equifax Credit Report Services||1-888-836-6351|
|Experian||Experian Fraud Center||1-888-397-3742|
|TransUnion||TransUnion Fraud Center||1-800-680-7289|
Placing an extended fraud alert comes with a little more paperwork. You’ll need to print and fill out a form, then mail it to the relevant credit bureau.
2. Request a fraud alert on your credit report
Be sure you know the right action you want to be taken on your account (either a one or seven-year fraud alert).
How to place a fraud alert with Equifax
- Visit Equifax Credit Report Services.
- Go to Add a fraud or active duty alert further down the screen, then and click Place an alert.
- Create your account.
- At this stage, you can place an initial or active duty alert online.
- If you’re looking to place an extended fraud alert, you’ll need to complete and mail an Extended Fraud Alert Request Form to Equifax.
How to place a fraud alert with Experian
- Visit the Experian fraud center.
- Click the Add a fraud alert.
- Choose the type of fraud alert you want to set up (initial, active duty, or extended).
- Similarly to Equifax, you can only place an initial or active duty alert online.
- You have to download and mail an Extended Fraud Victim Alert Request Form to Experian to place an extended fraud alert.
How to place a fraud alert with TransUnion
- Visit TransUnion’s fraud alert center.
- Choose the type of fraud alert you want to set up on your credit report (either one year, seven year or active duty) and click Add Fraud Alert.
- At this juncture, you’ll be prompted to create a new account or to log in to your existing account.
- Choose the type of fraud alert you want to set up.
- As before, while you can place an initial or active duty alert online, in order to set an extended fraud alert you’ll need to download and mail an Extended Alert Request Form to TransUnion.
3. Request your free credit report
After filing an initial fraud alert, you’re entitled to one free copy of your credit report. With an extended alert, you’re entitled to two free copies.
4. Let the fraud alert expire (or ask to remove it)
Remember that if you ask the credit bureau to remove the fraud alert on your credit report before it expires, it’s up to you to notify the other two bureaus. With TransUnion, you can remove a fraud alert online, while the other two credit reporting agencies require the request be made in writing.
Be sure to set a calendar reminder when your fraud alert is due to expire, so you can decide whether you want or need to extend it further.
And remember that while a fraud alert can help prevent any new accounts from being opened in your name without your consent, it doesn’t protect you against fraudulent charges made on an account you’ve opened in the past.
Check out our blog for the full lowdown on what to do if you think you’re a victim of credit card fraud.
Finally, don’t forget that protecting your personal information online is key to helping reduce your risk of identity theft.
So see for yourself how Clario’s all-in-one cybersecurity solution can help you regain control of your online identity.