The classical numerical treatment of two-point boundary value problems on infinite intervals is based on the introduction of a truncated boundary (instead of infinity) where appropriate boundary conditions are imposed. Then, the truncated boundary allowing for a satisfactory accuracy is computed by trial. Motivated by several problems of interest in boundary layer theory, here we consider boundary value problems on infinite intervals governed by a third-order ordinary differential equation. We highlight a novel approach to define the truncated boundary. The main result is the convergence of the solution of our formulation to the solution of the original problem as a suitable parameter goes to zero. In the proposed formulation, the truncated boundary is an unknown free boundary and has to be determined as part of the solution. For the numerical solution of the free boundary formulation, a noniterative and an iterative transformation method are introduced. Furthermore, we characterize the class of free boundary value problems that can be solved noniteratively. A nonlinear flow problem involving two physical parameters and belonging to the characterized class of problems is then solved. Moreover, the Falkner-Skan equation with relevant boundary conditions is considered and representative results, obtained by the iterative transformation method, are listed for the Homann flow. All the obtained numerical results clearly indicate the effectiveness of our approach. Finally, we discuss the possible extensions of the proposed approach and for the question of a priori error analysis.