Thieves can steal your identity when they access enough information about you to take out loans and open credit card accounts in your name. But to complete the final step in that process the thieves must be able to access your credit reports from all three credit reporting agencies – Experian,Equifax and Trans Union. If they can't access those reports, they can't borrow money in your name.

Simple process

All three credit reporting agencies make it relatively simple for you to place security freezes on your credit reports. There is a small, one-time fee for placing the freeze, with the size of the fee depending on the state in which you reside. However, the typical fee is $10 per credit reporting agency, for a total of $30. If you have been a victim of identity theft, the fee is waived in most states.

Before placing the freeze, you need to understand what that means for you as a consumer. Experian explains it very well.

“A security freeze is designed to prevent credit, loans, and services from being approved in your name without your consent,” the company says on its website. However, using a security freeze may delay, interfere with, or prohibit the timely approval of any subsequent requests or applications regarding a new loan, credit, mortgage, insurance, government services or payments, rental housing, employment, investment, license, cellular phone, utilities, digital signature, Internet credit card transaction, or other services, including an extension of credit at point of sale.”

That means if you are applying for an auto loan, mortgage or credit card, the process will be delayed until you temporarily lift the freeze. That process can sometimes take a day or two.

No spur-of-the-moment credit applications

It also means you won't be able to apply for a credit or charge card in order to qualify for a discount when checking out at a retail score. But maybe that's a good thing.

Placing a freeze on your credit will not interfere with existing relationships with existing creditors. They will still be able to access your account in regard to the account you have with them. They just won't be able to open a new account.

Here are the steps you need to take to freeze your credit at all three credit agencies.

Experian

Go to Experian.com and click on the “Customer Assistance” tab at the top of the page and choose the option “Security Freeze” from the pull-down menu. That takes you to a page that explains the process and allows you to select your state to complete the freeze.

Part of that process is getting a security code or PIN that identifies you, allowing you to temporarily lift the freeze. You can ask to lift the freeze online or by calling a toll-free number.

You complete the process by paying the fee, if any, with a credit or debit card.

Equifax

Next, go to the Equifax website. Click on the Credit Report Assistance” link at the top of the page.

Among the options on the page is “Place a Security Freeze.” Click on “expand,” located to the right, and then click the “Get Started” button. Enter the information to place a security information on your site. The information and fee will be very similar to what you encountered at Experian.

Trans Union

Finally, go to Trans Union.com and click on the “Credit Disputes, Alerts & Freezes” tab at the top of the page. Then, click on “Credit Freeze” sub tab and follow the directions for placing a freeze on your credit.

Remember that a security freeze remains on your credit file until you remove it or choose to lift it temporarily when applying for credit or credit-dependent services.

Freezing your credit is not a 100% guarantee against identity theft, but it blocks thieves from the most lucrative aspects of the crime. Even if someone steals your Social Security number, they will still be unable to open credit card accounts or take out loans in your name.

While unfreezing your credit when you want to buy a car or home may seem like a hassle, it could be a small price to pay to keep your identity from being stolen.