Updated: Dec 26, 2021
It is a widely shared credit repair tactic that has made its way around for years as a way to get negative accounts deleted from your credit reports, but does it really work, or is it just a myth?
A credit freeze or security freeze, is a tool consumers can use to secure access to their credit files – all of the data that makes up your credit reports - in an effort to prevent fraud and identity theft or unauthorized access to their credit files. Essentially, it prevents a financial institution from obtaining your credit file during their process of approving an application for a new line of credit using your identity. The only way the financial institution can gain access is with your approval. Each consumer reporting agency has their own process for allowing access once a freeze has been placed.
The logic of using this tool as a tactic for credit repair goes like this: once you place the freeze on your credit file it prevents a data furnisher or creditor – the companies that report information about you to consumer reporting agencies - from communicating with the consumer reporting agencies with regard to your credit file. Then, you dispute the negative account with the consumer reporting agency or the data furnisher. Because you have the freeze in place, the consumer reporting agency and the data furnisher are no longer able to communicate, the data furnisher is therefore unable to verify the account information and the consumer reporting agency has to delete the account.
At this point I want you to imagine the buzzer sound from Family Feud when a contestant gives an answer that is not on the board.
This “tactic: as a way to get negative items removed from your credit report is a complete MYTH! And here’s why:
A credit freeze can only prevent a financial institution from obtaining access to your credit file in order to establish a NEW line of credit, as a way to prevent fraud and identity theft. A credit freeze does not prevent a creditor from reporting information to a consumer reporting agency about you in relation to an EXISTING line of credit or debt.
Further, when a consumer disputes an item on their credit reports, the Fair Credit Reporting Act, as well as other consumer protection laws, REQUIRES data furnishers and consumer reporting agencies to be able to communicate with one another in the effort to verify the item being disputed. Therefore, the credit freeze cannot restrict the data furnisher’s ability to communicate with the consumer reporting agencies about an established account that they have previously reported to the consumer reporting agency.
Now, some will say “I have gotten accounts deleted after placing a freeze on my credit file.” And to them I say, don’t discount the possibility that the reason you were able to get an account removed from your credit file after placing a credit freeze was simply because you submitted a righteous dispute.
Let’s think about this logically – if a credit freeze prevents a data furnisher who is reporting a negative account from communicating with consumer reporting agencies, wouldn’t it stand to reason that it would also prevent data furnishers who report positive accounts from communicating with the consumer reporting agencies as well? And if that was in fact how the credit freeze worked, a credit freeze would do more harm than good to a credit file because any consumers who placed a freeze on their credit files would no longer have positive accounts updating on their credit files.
So, in conclusion, if someone placed a freeze on their credit file, and subsequently disputed a negative item which resulted in the item being removed, the removal was definitely not related to the credit freeze. And I can’t put it any better than John Winger – Bill Murray’s character in the great movie Stripes… “That’s the fact Jack!”
Remember, Boe Credit Consulting is here to help if you need it. We can provide you with a free credit consultation and we can also develop a custom and comprehensive plan to repair your damaged credit.
Contact Boe Credit Consulting today to learn how you can have the exceptional credit you deserve.
About the Author
Jeff Boe is a graduate of National American University, a Board-Certified Credit Consultant and the President of Boe Credit Consulting. He has successfully rehabilitated his own credit profile and, since 2005, has been working with consumers to educate and help them with improving their own credit.
In 2018 he started Boe Credit Consulting in order to help even more people improve their literacy as it relates to the credit system in the U.S. as-well-as to improve their credit reports and scores so they can be free to realize their financial goals.
Boe Credit Consulting specializes in helping credit-challenged consumers improve their credit reports and scores so that they can achieve their financial goals.
For more information, visit www.BoeCredit.com
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