Freddy is always invisible to survivors that are awake. He's in the dream realm and his power lets him pull survivors in there with him. If you are awake he cannot touch you unless you are in a locker.
When he pulls you into the dream world, there is a slight delay between you falling asleep and actually being asleep. It's in between 3-10 seconds I think based on his add-ons.
To wake up from the dream world you can do 1 of 5 things:
1. Adrenaline - the perk for meg that heals you 1 state and gives a speed boost when the 5th gen is done will take out of dream world
2. Get hooked - probably the easiest way but who wants to do that
3. Fail a skill check on a gen or healing somebody
4. Get woken up by a teammate who is already awake. If you are both asleep you cannot wake each other up unless you are injured and they fail a skill check healing you
5. Get healed from being asleep on the ground will instantly wake you up.
When you are in the dream world you perform all actions 50% slower (opening gates, healing, doing gens, searching chests even I think). Also when you are outside of freddy's terror radius he can see your aura through walls.
Best advice I can give, is to wake yourself up and be aware of the transition. You can do stuff like grab a survivor off a hook when the exit gates are open and most of the time he literally cannot stop you since he has to put you to sleep to attack you.
Thanks for the tips, I'll try to put them in practice. Actually Freddy is one of the killers I'm thinking about getting once I get more familiar with the game, so that'll definitely help