Does Placing a Fraud Alert Hurt Your Credit Score?

No, placing a fraud alert does not hurt your credit score. It simply tells creditors to take extra steps to verify your identity before approving new credit in your name.

You can place one without worrying about any negative impact on your credit rating.

What is a fraud alert anyway?

A fraud alert is like a "please double-check" note on your credit report. You can add one if you think someone might be using your personal info without permission. When you have a fraud alert, lenders need to take extra steps to make sure it's actually you applying for credit.

The good news? When you place a fraud alert with one credit bureau (TransUnion or Equifax), they'll tell the other one for you. That saves you some work!

Three types of fraud alerts

There are three kinds you can choose from:

• Initial fraud alert: Good for one year. Use this if you're worried about fraud or noticed something fishy. You can renew it as many times as you want.

• Active-duty alert: For people serving in the military. Also lasts one year and tells lenders you're on assignment.

• Extended fraud alert: Lasts seven years. You'll need to file a police report first, since this one's for confirmed identity theft victims.

How fraud alerts affect getting credit

While your credit score stays the same, getting approved for credit might take longer.

Here's why:

That quick "approved in seconds" experience might not happen when you have a fraud alert. Most instant approval systems aren't set up for the extra identity checks a fraud alert requires.

For example, if you're trying to get a store credit card while shopping, you might need to speak with someone on the phone to verify who you are instead of getting an instant yes.

But remember: lenders legally can't turn you down just because you have a fraud alert. If your credit is good enough, you'll still get approved—it just might take a bit more time.

Removing a fraud alert

Unlike placing an alert (where one call does it all), you'll need to contact each credit bureau separately to remove alerts. The process is pretty quick but requires a few more steps than adding one.

Protection without penalty

Fraud alerts give you an extra layer of security without hurting your credit score. Think of them as free security guards for your credit report. If you're worried about identity theft or know someone's using your info, setting up a fraud alert is a smart move that won't cost you credit points.

Remember to keep an eye on your credit report regularly too. The sooner you spot something wrong, the easier it is to fix!