Freezing Credit Reports

[Anonymous]

Not sure if this is the right forum to post under - if not I apologize in advance.

I posted the below question in another thread and received no responses (probably because it was a thread jack based on a previous post but I digress ) so I thought I should make a separate post:

I have always wondered why I see the above mentioned so many times on the board and have been shy to ask about it. How does "freezing" a report translate to positive action for the person trying to obtain credit. So I apply for XYZ company and my EX and EQ reports are frozen. What happens if they dont normally pull TU reports? Does this mean i get denied and would have to unfreeze the report they normally pull? I do not understand how the freezing process is beneficial. Thanks in advance.

I now have a 2nd part to add to my question. I have a LOC from HFC. For the last few months I have been paying it 20 days past due. Ironically in the last few months I have received hard inquires on all 3 of my reports from HSBC Beneficial/HFC. To my knowledge they should only be doing soft pulls (I think) if they want to check my report. However, is this an instance where I would want to freeze my report since I have no intention of applying for additional credit anytime soon? Thanks

[daisyduke]

Hi purplehaze,

I would not say freezing is per say a positive thing to do for your credit reports, nor would I say it is a negative thing to do....however, if you have been a victim of ID fraud (as I have been) I am frozen because I don't want anyone opening up accounts in my name. The benefit is security.  The other benefit is that (not 100% sure b/c I don't have direct experience with this) is that IF you have a bill collector after you and your reports are frozen, a "hard" inquiry cannot be made. So it works for two reasons, but not truly intended for the second reason.

I just bought a car and had to unfreeze TU. When I applied for Bloomingdales, I called and knew they only pulled EX, so I unfroze that report for a period of time, then went back. I am frozen on two out of three bureaus.

IF you apply for credit and you are frozen with that specific bureau, you most likely will not be granted the credit. I have read that some lenders will pull other reports if you are frozen on one, but again, I don't have direct expereince with that strategy to keep the inquiries down. If you want the credit and you know they only pull a certain bureau, I would just unfreeze.

You have to freeze the reports with each bureau, there is no central point of contact. If you do not have a police report relating to identity theft, you will have to pay to have this done, it's nominal at  around $10 to freeze/unfreeze.

On to your other question about existing creditors doing a hard inquiry when in fact you have not asked for a CLI, I have no experience with hard inquiries being done with existing creditors, mine have all be softies. Sounds fishy to me but if you were late, who knows what they can do.  Maybe internal collection dept at HSBC?   I'd love to know about this however, the regulations/rules on what an existing creditor can do and cannot do.  I can't seem to find it anywhere and i've been looking...for my own personal reasons....i can't find a darn thing!

Hope this helps you.