Does It Hurt My Credit Score If I Freeze My Credit Card?
According to CNN Money, the average family in the United States that has a credit card carries an average debt of $10,700. With compounding interest, it can become increasingly difficult to pay down your credit card debt. However, one of the ways that you can work towards paying your credit card debt is to freeze your credit card. By freezing your credit card, you can pay down your balance without adding additional debt because you will no longer have access to additional credit on the card.
Other People Are Reading
-
Your Credit Score
-
The credit uses several different criteria to calculate your credit score. These credit scoring factors include the length of your credit history, payment habits, amount of your debt, credit type and any new credit you recently acquired. Although freezing your card can reduce your credit score initially by reducing your total amount of available credit, in the long run, freezing your account can benefit your credit score by allowing you to pay down your credit card balance.
Freezing Your Credit Card
-
When you want to freeze a credit card, call your credit card issuer and tell them you want to freeze your card. Depending on the policy of the credit card company, you might have to fill out a form authorizing the freeze. Other companies, however, will allow you to freeze the card over the phone. Once you initiate the freeze, you cannot use the card until you remove the freeze.
-
Paying Your Balance
-
Although you cannot continue to use the card while frozen, you will still have an obligation to continue to make payments as contracted. Ideally, you should work towards paying off the entire balance of your card as quickly as possible. Interest will continue to accrue on the card until you pay off the balance completely. If you have good credit, you can also consider applying for a new credit card with a zero-percent introductory offer and transferring the balance from the frozen card to this new credit card. This allows you to work towards paying the balance without continuing to accrue new interest charges.
A Credit Freeze
-
A credit freeze is not the same thing as a credit card freeze. While a credit card freeze prevents you from using a specific credit card, a credit freeze prevents the opening of a new credit account by anybody using your Social Security number. You can freeze your credit by contacting the three credit bureaus, TransUnion, Equifax and Experian, and requesting the freeze. However, this type of freeze will also prevent you from applying for new credit until you lift the freeze. A credit freeze will not affect your credit score in any way.
-
