Remind Buyers to Unfreeze Credit

January 30, 2018

Following last year's Experian data breach, many people froze their accounts to safeguard them from potential identity thefts. But with the spring homebuying season on the horizon, don’t forget to remind potential home shoppers that they may face some hassles getting approved for a mortgage if they don’t remember to unfreeze their credit first.

Lenders tend to pull reports from the three main credit bureaus—Equifax, Experian, and TransUnion—when approving a buyer for a mortgage.

For those who froze their accounts during the Equifax data breach, they’ll need to remember where they froze it and to unfreeze it, says John Danaher, president of consumer interactive at TransUnion. “You may want to take a day or two to unfreeze them before you apply, but definitely make sure they are all unfrozen,” he told ABC News. “It could potentially cause an issue if they can only get one or two out of the three.”

Security freezes are to prevent credit reporting companies from releasing your credit report without your consent and to prevent thieves from opening an account or getting credit using your personal information. But a freeze can also potentially delay, interfere, or prohibit timely approval of any financing request or application, such as with a mortgage, rental housing, new loans, utilities, and more.  

Many Americans rushed to freeze their credit last year when a massive data breach within Equifax was exposed. Hackers stole personal data, including Social Security numbers, birth certificates, addresses, and some driver’s license numbers, of an estimated 143 million Americans.

When you freeze a report, you’re often given a PIN that allows you to freeze or unfreeze the report at your own discretion. Or, you can contact the three nationwide credit bureaus to learn about unfreezing credit:

Source: “TransUnion Exec Talks Credit Scores and Real Estate,” ABC News (Jan. 28, 2018) and “Here’s Why You Probably Don’t Want to Freeze Your Credit,” Huffington Post (Sept. 14, 2017)