How to Check Your Credit Score
by Odysseas Papadimitriou. CardHub CEO
There are a number of ways to check your credit score. There are also a number of different credit scores that you can check.
That’s right; no one has just a single credit score. There are literally more than 1,000 different credit scoring models out there, and the fact that major banks typically modify the ones they use with their own proprietary algorithms expands the options exponentially.
Creditors don’t tend to be too forthcoming about the specific scoring criteria that they consider either. Plus, in as many cases as not (probably more, in truth), you’ll also have to pay to access whichever credit score you decide to check out.
All things considered, checking your credit score is therefore an inefficient and potentially expensive exercise. After all, what good is checking to see how a lender is going to perceive you if you aren’t looking at things through the same prism?
With that in mind, let’s take a closer look at how to go about accessing your credit score – especially the FICO score – as well as the advantages and disadvantages of doing so, how to put your number in context, and what action to take based on it below.
Drawbacks of Checking Your Credit Score
As mentioned above, there are a number of reasons why you might want to hold off on ordering your actual credit score, including the fact that:
- It’s hard to determine which credit score a particular lender uses.
- The vast majority of credit scores aren’t free, especially the ones that are most commonly used by lenders.
- Credit scores are all based on the information in your Experian, Equifax, and TransUnion credit reports, which you can access for free once every 12 months. Credit reports aren’t always accurate either, and credit scores based on erroneous information are worthless.
Benefits of Checking Your Credit Score
There are also a few reasons why ordering your credit score at least one time could be wise, including:
- A credit score provides an easy-to-digest numerical reference point.
- It can help you determine the loan and credit card terms that you stand to be approved for as well as what improvements you can make in order to get the best possible deal.
- It makes comparing financial products easier, since most offers denote the particular credit score or credit classification (e.g. Excellent, Good, Bad) needed to get them.
- It can be used as a litmus test for how closely you need to be reviewing your credit reports. A score that is much lower than you’d expect is an obvious red flag.
- A limited number of credit scores are truly free to obtain.
What Credit Scores Can You Buy?
If you’ve ever looked into ordering your credit score, you know there are a variety of ways to do so. Choosing the right one necessitates knowing what type of credit score you’re looking for as well as what fees and fine print will apply to the transaction should you decide to pull the trigger.
We’ll evaluate some of the most notable options below.
CONSUMER ALERT: The services listed below may advertise free or low-cost access to credit scores, but the advertised costs are for an initial trial period and you are required to provide credit card information when signing up. If you do not cancel your account before the free trial period ends, you will be automatically enrolled in a for-pay subscription service. The companies also tend to make it difficult to cancel your account in order to increase the odds that you’ll end up paying something. It’s therefore very important to proceed with caution.
- MyFICO: The consumer portal to the Fair Isaac Corporation advertises the availability of a free credit score, but when you click on the offer through the company’s website, you’ll find that you’d actually be signing up for a free 10-day trial that gives you access to your basic FICO score. If you don’t cancel your subscription within 10 days, the credit card that you’re required to provide when signing up will be charged $14.95 per month for a minimum of three months.
- Experian: Experian offers a $1 credit score, but there’s a big asterisk next to that price tag. Your order enrolls you in a 7-day trial membership for the Experian Credit Tracker. If you don’t cancel your subscription before the end of the trial period, you’ll be charged $19.95 each month until you do cancel.
- Equifax: The cheapest option available through Equifax is called Score Power. It gives you access to your FICO score, your Equifax credit report, explanations of what is helping and hurting your credit standing, and how different actions will affect your standing. It costs $15.95.
- TransUnion: You can access your TransUnion credit score by signing up for a 7-day free trial, which turns into a $16.95/month subscription service once the trial period concludes.
- FreeCreditReport.com: Many people confuse this company (the one with the catchy songs on its commercials) with the government-sponsored service that provides free access to each of your major credit reports once every 12 months. They are not even close to being one and the same. FreeCreditReport.com – which is owned by Experian, by the way – offers access to your credit report and score for $1, but it’s only a 7-day free trial (which might actually turn out to be 5 days since the site states that new accounts may take 2 business days to process). After the free trial ends, the service will cost you $19.99.
What Credit Scores Can You Get for Free?
It’s best to avoid the aforementioned services that purport to offer free credit scores because they actually enroll you in a free trial for a fee-based subscription service that kicks in if you don’t cancel your account on time. They also tend to make it pretty difficult to cancel once you’re signed up. Nevertheless, there are a few places where you can get your credit score for free.
CONSUMER ALERT: While the following companies offer free credit scores and do not require you to provide credit card information when signing up, they will present you a slew of other offers when you’re on their websites. As you might expect, a primary goal of these services is to recoup the cost of providing you with a free credit score because there truly is no free lunch.
- Credit Sesame: This website struck a deal with Experian that enables it to offer the company’s Plus Score for free to consumers without making them provide any credit card information. That doesn’t mean it won’t cross-sell for-pay services along the way, as Experian benefits from the partnership through the business Credit Sesame brings it.
- Quizzle: Quizzle offers free access to your CE Score through a partnership with Experian.
- Credit Karma: CreditKarma.com, which partly owned by TransUnion, offers free access to your TransRisk Score as well as your VantageScore.
- Credit.com: This website offers free access to your Experian VantageScore.
For a full breakdown of free credit score providers and the type of data each provides, check out WalletHub’s Free Credit Score Comparison page .
Using Your Credit Score
People have different reasons for checking their credit scores. Some are simply seeking a number to quote so they can see how they stack up against other people. Others want to know if they’re ready to apply for a mortgage or other type of loan.
Regardless of your particular motivation, you can’t get too caught up in an exact number of forget that getting access to your score is only the first step. As mentioned above, there are a number of different credit scores out there and they often use different score ranges, so your particular number is far less important than what credit classification it puts you in (e.g. excellent, good, average, bad). In order to maximize the benefit of checking your credit score, you’ll also need to consider what your score classification says about your financial habits, what you may need to change, and how to go about doing so.
What’s more, you have to remember that your credit score is only one piece of information that lenders and other decision makers use to evaluate you. They also reference your credit history (i.e. your credit reports) as well as your income, assets, and debt levels.
You should therefore consider the total picture that all of these factors paint when making sense of your credit standing and/or establishing a plan to improve it.
At the end of the day, ordering your credit score isn’t necessarily good or bad. Your particular situation, intended use, and the associated costs will determine that. But it’s important to remember that checking your credit score should never be used as a replacement for ordering a free copy of each of your major credit reports once a year. Doing so will enable you to spot cases of fraud as well as ensure that your credit scores aren’t based on inaccurate information .
Image: PureSolution/ShutterstockSource: www.cardhub.com