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Why is it that credit bureaus can gather such a great amount of information about you and sell it? Don’t you have a say in how your information is handled or whether it should be handled by anyone at all? There are reasons why your name and social security number have a credit file, this really does make things easier when you apply for a mortgage or a car loan etc. In today’s economy there’s a significant need for credit and an organized system for reporting it. But your identity does not belong to you in the sense that the collected information is in fact the property of the credit bureau that gathered the information.

There are more than 1,000 local and regional credit bureaus around the country (US), the three major ones are Experian, Equifax and TransUnion. All of which collect and record information reported to them by your creditors, banks, credit card companies, private lending institutions etc.

Yes they sell your information to third parties and this is profitable for them, and those third parties may resell or share that information with other business partners who then pre-approve you for dozens of credit offers each year and add you to their mailing/distribution lists to send you stuff you don’t really need.

Why this puts your identity at risk?

The trading and exchanging of personal consumer information is risky business, for the consumer that is. Those who obtain your information from the credit bureaus could mishandle your information and expose you to a hacker. Unfortunately this is simply the cost of doing business.

Credit bureaus are private companies with a business that’s regulated because it involves a certain degree of risk for the information owner. Those regulations do not yet do enough to protect consumers however. Hey cigarettes and alcohol are dangerous also, but they’re not going to stop selling them are they? As long as they’re regulated and the producers pay federal taxes, all is well.

Do you have any say in this?

Luckily yes. You can request a credit freeze. Sometimes known as security freeze, prevents a credit reporting bureau from releasing your credit report and stop inquiries and subscriptions on your account without your consent. You can request a credit freeze from each of the credit bureaus, and typically you’ll be provided with a personal identification number and/or password if you ever want to remove it.

The most immediate advantage of placing a freeze on your credit report is to stop releasing your information to those who intend to market to you. But you must also know that by placing a credit freeze on your file you’ll stop your own self from being able to get credit, apply for a mortgage or a car loan. If you can live without those things and simply want to take control of your identity now, then a credit freeze will work great.

This mostly applies to the 3 major credit bureaus, other companies that gather information about you must be contacted individually and there could be hundreds of them. They can still trade your information and continue to send you junk mail and credit offers if they already have you on file. The freeze only stops the bureaus from further releasing information about you.

One way to address your information already being available is to either use credit monitoring or identity theft services. Although you can do much of what these services yourself, it will prove time consuming and burdensome to tackle this task on your own. Definitely something to consider.