Definition
A free lock on your credit report that stops most new lenders from seeing it, which makes it harder to open accounts in your name.
What it means
A credit freeze, also called a security freeze, restricts access to your credit report so a thief cannot easily open new credit in your name. Federal law makes placing and lifting a freeze free at each of the three nationwide credit reporting companies, and you need to contact each one separately. A freeze does not affect your credit score, and your current creditors can still see your report. When you apply for credit, you can lift the freeze temporarily or for a specific lender, and a request made online or by phone must generally be honored within one hour. A fraud alert is a different tool: it asks lenders to verify your identity and lasts one year, or seven years for an identity theft victim. Parents can also freeze a child's credit.
Example
Before applying for a car loan, you lift your freeze at the one company the dealer uses for 3 days, then the freeze returns automatically. The cost is $0.
Illustrative numbers only. Your situation will differ.