What is a fraud alert?

The major credit bureaus maintain credit files on individuals that creditors and lenders access for a number of different reasons. If you suspect that you have been or could become a victim of identity theft, you have the right to have fraud alerts placed in your credit files. When a fraud alert is in your credit file, creditors and lenders must confirm your identity before they issue new credit, increase credit limits, approve loans, or approve new credit accounts to anyone using your identity. Typically, creditors will attempt to confirm your identity by phone using a number you specify, but they may take other “reasonable steps” to make sure that credit is not authorized using your identity without your permission.