What does a credit freeze do?

A credit freeze is a powerful tool that restricts access to a consumer's credit report. When a credit freeze is in place, lenders cannot access the credit report to evaluate the consumer's creditworthiness, which means that new credit accounts cannot be opened in the consumer's name without first lifting the freeze. This is particularly useful as a protective measure against identity theft; it helps prevent unauthorized individuals from using stolen personal information to secure new loans or credit cards.

In regards to the other options, they do not accurately describe the function of a credit freeze. Instant approval for new credit applications does not occur with a freeze in place, nor does a freeze have any impact on credit scores, as it is solely designed to manage access to credit reports rather than influence credit history or scoring. Additionally, a credit freeze does not facilitate access to bank statements at all; rather, it focuses specifically on regulating access to credit reporting agencies.