What are credit protection fees?
Definition
Credit protection fees are charges for paid services like credit locks and credit monitoring. A credit freeze, which protects you just as well from new accounts being opened, is free by law.
- Category
- Identity
- Also called
- credit lock fees, credit monitoring fees
- Last updated
"Credit protection" is a marketing label, not a legal term. Under it you'll find free tools and paid ones, and the paid ones often copy what you can already get for nothing.
What costs money and what doesn't
The CFPB, the US consumer finance regulator, says credit reporting companies sell "credit locks" for a fee, often bundled with other services you must pay for. It states that locks are no more effective than security freezes, which are free and which you have a right to by law.
The FTC lists these as free: a credit freeze (no cost to place or lift, no effect on your credit score), an initial fraud alert (lasts 1 year), an extended fraud alert (7 years, for identity theft victims with an FTC report or police report) and an active duty alert for servicemembers.
What a freeze does
While a freeze is on, nobody can open a new credit account in your name, including you. You can lift it temporarily when you apply for credit, a job, an apartment or insurance. You freeze at each of the three bureaus (Equifax, Experian and TransUnion) separately. A bureau must place a freeze within 1 business day when you ask by phone or online, and lift one within an hour.
Where paid products may still fit
Monitoring that alerts you to changes can be useful, but check what you're actually paying for and whether a free freeze already covers the risk you care about.
How to protect yourself
- 1
Freeze your credit at all three bureaus
Contact Equifax, Experian and TransUnion separately. It's free, lasts until you lift it and doesn't affect your score.
- 2
Lift it only where needed
The FTC suggests finding out which bureau a lender will use and lifting the freeze only there, then putting it back.
- 3
Add a fraud alert if you suspect identity theft
Contact one bureau and it must tell the other two. Initial alerts are free and last a year.
- 4
Read the fine print before paying for a lock or bundle
Ask what the fee covers that a free freeze doesn't.
- 5
Cut down what thieves can find about you
Addresses and phone numbers on people-search sites help with identity theft. Serus finds where yours are listed and removes them.
See where your personal data is exposed
Serus finds it on data brokers and people-search sites and removes it.
Frequently asked
Is a credit freeze really free?
Yes. The FTC and CFPB both say placing and lifting a freeze costs nothing at the three nationwide credit bureaus.
Is a credit lock better than a freeze?
The CFPB says locks are no more effective than freezes. Freezes are free and backed by law.
Does a freeze hurt my credit score?
No. Security freezes don't affect your credit scores at all.
Sources
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