An Essential Guide on Security Freezes

Due to the recent Equifax data breach, we’ve provided you with helpful instructions on what to do if a consumer has placed a security freeze on their credit profile.

What is a Security Freeze?

A security freeze on a credit report prevents new services or loans from being granted in a consumer’s name. If a consumer places a security freeze on their credit profile, it may delay the approval of credit applications they initiate.

If a consumer wants to place a security freeze, they have to place them separately with each credit reporting agency; security freezes are not shared automatically with the other agencies.

If a consumer wants to unfreeze their credit report, they will need to do so with each credit reporting agency they placed one with.

If you or your applicant want to learn more about how each credit reporting agency handles security freezes, click on one of the following:

                      Equifax                                           Experian                                            TransUnion

What to do Before You Pull an Applicant's Credit Report

1. Prior to pulling an applicant’s credit report, confirm with that applicant whether or not they placed a security freeze with any/all of the three credit reporting agencies. If there were no freezes placed, continue the loan process as normal.
2. If the applicant(s) placed a security freeze on their credit profile, they will need to call each credit reporting agency they placed the freeze with and request either a temporary or permanent lift of the credit freeze. If the applicant chooses to place a temporary lift, they can specify over the phone how long they want their credit profile to be thawed.  For example, they can thaw it for a week to allow the initial pull of their credit report or they can choose a longer duration that will cover the pre-close credit pull so that they don’t have to go through the process again. At the end of the duration they specified, the freeze will be placed back on their profile. There are fees associated with lifting security freezes and they vary by state.

• • The applicant should not request a single-use PIN to thaw their credit profile. The single-use PIN isn’t an option during the mortgage credit pull process because of technical limitations with lenders, LOS, and the GSEs.

Equifax

800.685.1111 (NY Residents: 800.349.9660)

Experian

888.397.3742 (Select option 2)

TransUnion

888.909.8872

4. Each state has its own laws and specific procedures that the bureaus must follow for freezing and thawing credit reports. It’s recommended that you allow up to three days for a consumer’s credit history to be thawed.
5. Once the applicant tells you that they’ve completed the process of thawing their credit profile and the three days have passed, you can pull the credit report.
6. Remember to tell your applicant that prior to closing they may have to go through this process again. If they choose not to, it could slow the closing process or potentially put the closing at risk.

How Security Freezes Impact Other Informative Research Products

• SoftQual

SoftQual will not be able to prequalify any consumer that has a security freeze on their credit profile.

• Rescore

The Rescore is impacted by security freezes the same as credit reports. If a Rescore needs to be done on an applicant, follow the steps listed above for credit reports and ensure the bureaus have completed their investigations prior to re-pulling credit.

• PreClose Monitoring

If an applicant has a security freeze on their credit profile, they can’t be monitored with PreClose Monitoring. If an applicant places a security freeze on their credit profile while they’re being monitored, proper notification will be sent.

• PreClose Credit Report

To pull a PreClose Credit Report on a profile that has a security freeze, instruct your applicant to follow the steps listed above for credit reports.

• Portfolio Solutions

Portfolio Solutions are not impacted by security freezes.

How Will We Handle Calls from Consumers with a Security Freeze?

If a consumer calls and asks Informative Research to act on their behalf with a credit reporting agency, we’ll inform them that we cannot perform this function and will provide them with the same instructions and phone numbers in this notice.

Questions?

If you have any questions, please call Technical Support at 800-366-2794 or send an email to techsupport@informativresearch.com.

Security Freeze Fees