Your child's loan: worth the protection!

Having a baby is wonderful news, but it can be a terrible thing. Not only are you fully responsible for the well-being of your child, it is also your duty and as a parent to ensure that your child is protected in every possible way – this includes the protection of your child. Identity thieves often target children because the child loan is unharmed (or does not exist at all).

Although you think that the government protects children from such types of theft, this is not the case.

Only at the state level

The only federal law that was created to protect the child's credit identity is the Law on the Protection of Children from Identity Theft (which was drafted in 2015), which is not a law at all. In fact, there is less than 2% chance that this law will pass to different sources. The law would enable parents to create a child's credit report and then freeze that report in order to prevent identity theft. However, the law has not been signed by the president, and it seems that he will not even get to his desk.

This led various countries to create similar laws at the state level, although not all states allow parents to create a credit report and freeze it. This is an important thing. The recent media coverage of freezing credit reports often leads people to believe that all countries allow parents to make a credit report and then freeze it, but that's not true. Some countries do not allow the creation and freezing of credit reports.

Countries that allow freezing legally

There are only a few countries that allow parents to create a credit report for a minor, and then freeze that report. The states are Arizona, Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Iowa, Louisiana, Maine, Maryland, Michigan, Montana, Nebraska, New York, North Carolina, Oregon, South Carolina, Tennessee, Texas, Utah, Virginia and Wisconsin . Other states only allow a parent to go through this process if a child is under 16 years of age (this is often not useful because identity theft is happening to children much younger than 16).

Help of credit bureaus

Some credit bureaus have taken things into their own hands. For example, Equifax will allow juvenile parents (regardless of their country of residence) to create and freeze a credit report. Trans Union allows parents to check whether any credit fraud has occurred, and also allows parents to create and freeze a credit report if they are located in the above countries. Some credit bureaus in countries where there are no laws to deal with identity theft of minors allow parents to create and freeze credit reports for a small fee – however, if a parent can prove fraud, this fee can be canceled.