Best way for a 'forgot password' implementation? [closed]

Update: revised in May 2013 for a better approach

1. The user enters his username and hits "forgot password". I also recommend the option of entering the email address instead of the username, because usernames are sometimes forgotten too.
2. The system has a table password_change_requests with the columns ID, Time and UserID. When the new user presses the button, a record is created in the table. The Time column contains the time when the user pressed the "Forgot Password" button. The ID is a string. A long random string is created (say, a GUID) and then hashed like a password (which is a separate topic in and of itself). This hash is then used as the 'ID' in the table.
3. The system sends an email to the user which contains a link in it. The link also contains the original ID string (before the hashing). The link will be something like this: http://www.mysite.com/forgotpassword.jsp?ID=01234567890ABCDEF. The forgotpassword.jsp page should be able to retrieve the ID parameter. Sorry, I don't know Java, so I can't be more specific.
4. When the user clicks the link in the email, he is moved to your page. The page retrieves the ID from the URL, hashes it again, and checks against the table. If such a record is there and is no more than, say, 24 hours old, the user is presented with the prompt to enter a new password.
5. The user enters a new password, hits OK and everyone lives happily ever after... until next time!

It all depends on your site and the level of security that you're trying to achieve but the basic process for a web app goes something like the following:

1. The user navigates to the 'forgot my password' page and enters their username or email (whichever is unique) to request a password reset.

2. Optionally at this stage you can confirm the request by asking for additional information such as the answer to a predefined security question or their date of birth etc. This extra level stops users receiving emails they didn't request.

3. Look up the user's account. Save a temporary password (usually a GUID) and timestamp against the account record. Send an email to the user containing the temporary password.

4. The user either clicks on the link containing the temporary password and the user's identifier in the email or navigates to the 'forgot my password' page and copy & pastes the temporary password and their identifier. The user enters their new password and confirms it.

5. Look up the user's record and if the current time is within a specified time limit (e.g. 1 hour) of the timestamp saved in step 2 then hash and save the new password. (Obviously only if the temporary passwords match!). Delete the temporary GUID and timestamp.

The principal here is that the user is emailed a temporary password that let's them change their password. The originally stored password (it should be hashed!) is never changed to a temporary password in case the user remembers it.

The original password will never be displayed to the user as it should be hashed and unknown.

Note this process relies entirely on the security of the user's email account. So it depends on the level of security your wish to achieve. This is usually enough for most sites/apps.

Troy Hunt makes some excellent points in his article, Everything you ever wanted to know about building a secure password reset feature. The most relevant excerpts are:

[T]here are two common approaches:

1. Generate a new password on the server and email it
2. Email a unique URL which will facilitate a reset process

Despite plenty of guidance to the contrary, the first point is really not where we want to be. The problem with doing this is that it means a persistent password – one you can go back with and use any time – has now been sent over an insecure channel and resides in your inbox.

...

But there’s one more big problem with the first approach in that it makes the malicious lockout of an account dead simple. If I know the email address of someone who owns an account at a website then I can lock them out of it whenever I please simply by resetting their password; it’s denial of service attack served up on a silver platter! This is why a reset is something that should only happen after successfully verifying the right of the requestor to do so.

When we talk about a reset URL, we’re talking about a website address which is unique to this specific instance of the reset process.

...

What we want to do is create a unique token which can be sent in an email as part of the reset URL then matched back to a record on the server alongside the user’s account thus confirming the email account owner is indeed the one attempting to reset the password. For example, the token may be “3ce7854015cd38c862cb9e14a1ae552b” and is stored in a table alongside the ID of the user performing the reset and the time at which the token was generated (more on that in a moment). When the email is sent out, it contains a URL such as “Reset/?id=3ce7854015cd38c862cb9e14a1ae552b” and when the user loads this, the page checks for the existence of the token and consequently confirms the identity of the user and allows the password to be changed.

...

The other thing we want to do with a reset URL is to time limit the token so that the reset process must be completed within a certain duration, say within an hour.

...

Finally, we want to ensure that this is a one-time process. Once the reset process is complete, the token should be deleted so that the reset URL is no longer functional. As with the previous point, this is to ensure an attacker has a very limited window in which they can abuse the reset URL. Plus of course the token is no longer required if the reset process has completed successfully.

He makes many more good points about avoiding information leaks, CAPTCHAs, two-factor authentication, and of course the basic best practices like password hashing. I think it's important to note that I disagree with Troy on the usefulness of security questions, preferring Bruce Schneier's skepticism of the practice:

The point of all these questions is the same: a backup password. If you forget your password, the secret question can verify your identity so you can choose another password or have the site e-mail your current password to you. It's a great idea from a customer service perspective -- a user is less likely to forget his first pet's name than some random password -- but terrible for security. The answer to the secret question is much easier to guess than a good password, and the information is much more public.

I'll go with:

1. Ask user for email, check email is registered
2. Generate GUID, and send it to that email
3. Do not reset password yet
4. User clicks link, and then have to enter new pass
5. Reset password only after user is in your site, and have clicked reset button after typing new pass.
6. Make that GUID expirable within a short time period to make it safer.