Having a good credit score is integral to getting goods and services at a reasonable rate. Most creditors will look pull up at least one of your scores, whether you are looking for a loan, housing, a credit card, or some other product or service.
It’s important to have at least a rough idea of your current credit score,Â whether that’s so you’re prepared for what creditors are going to see when they pull up your history, because you are trying to improve your score, or something else.
There are a number of different services that can help you get a good overall picture of your credit health. But which ones are the best? And what do their scores really tell you? Below, we explain exactly what credit scores are and list some of our favorite places to access your scores for free.
Read on for the details!
What Are Credit Scores?
In short, credit scores are numbers that represent your creditworthiness. Lenders, credit card issuers, and other services that expect payment, like utility companies, cell phone providers, and more, look at your credit score to see how creditworthy you’ve been in the past, which indicates how likely you are to pay on-time in the future. Personal credit scores range anywhere from 300 to 850; the higher the better.
Each creditor has their own ideas about what’s considered “good” credit, but typically if you have a score above 600, you won’t have a terribly difficult time finding creditors willing to work with you. However, the higher your credit, the more services you’ll qualify for, and the better rates you’ll receive.
Contrary to popular belief, you don’t have justÂ oneÂ credit score; in fact, you have many. Credit scores are derived from your credit report — a history of your past debts, payments, and other information gathered by credit reporting agencies. The big three credit reporting agencies are Experian, Equifax, and TransUnion.Â While all three agencies gather similar information about you, they might not all have the same information.
A scoring algorithm, usually either VantageScore or FICO, is applied to your credit report to come up with your score. As such, consumers have many different credit scores, depending on the scoring system and the credit report your information was derived from.
VantageScore VS FICO
Credit scores are derived from your credit report using a scoring model, either VantageScore or FICO. Both have scales of 300 to 850, but they might return different scores because they place importance on different factors.
Most free credit score services get their data from VantageScore. However, many creditors will look at your FICO score. If a potential lender pulls your TransUnion FICO score, for example, they will get a different number than what you’re seeing from your free credit score service.
That said, the difference in scores doesn’t tend to be large; if you have a high FICO score, you will also have a high score from VantageScore. Conversely, if you have a poor (or inaccurate) marks on your report, they will be reflected by both VantageScore and FICO as a lower score.Â For general credit score monitoring, either VantageScore or FICO will suit most consumer’s purposes.
If you need to know your FICO score, for whatever reason, you have a few different options:
- Some of your FICO scores can be accessed for free via Discover Credit Scorecard (see below). This score is derived from your Experian data.
- Scores derived from all three credit reporting agencies can be purchased directly from FICO viaÂ myFICO. Currently, one-time access to scores from all three agencies can be purchased for $59.85 ($19.95 for scores from one agency).
- Some credit card issuers, or other places that extend credit, will provide your scores if you are a customer.
Be aware, however, that even if you check your FICO score from the same agency that your lender does, you still might be looking at a different score. FICO offers a number of different credit scores, some of which are not available to consumers.
The Best Free Credit Score Services
The following are our favorite credit score services. These services derive scores from at least one of the three major credit reporting agencies. All offer services for free and are available to all consumers.
Credit Karma was one of the first online services to offer your credit scores for free. This service offers scores and reports from two agencies: Equifax and TransUnion (both VantageScore). Scores and reports are updated weekly. They also offer free daily credit monitoring, but only for TransUnion.
Credit Karma is the only service we know of that offers free scores from two different agencies; it is also the only one that pulls data from Equifax. Additionally, it offers a number of other useful financial tools for consumers, including personalized credit card and loan recommendations, financial calculators, informative financial blog posts, and even help filing your taxes.
Discover Credit Scorecard
Discover has recently started offering free credit scores to all consumers, regardless of whether or not you are a Discover customer. This is one of the only services to offer a free FICO score; most free credit score services provide your VantageScore.Â Discover’s FICO score is derived from Experian, and it’s updated on a monthly basis.
Be aware, however, that because FICO offers a number of scores, the score shown on your Discover Credit Scorecard might not be the same score that your creditors are using. However, it might still be worth a look for educational and general credit monitoring purposes.
WalletHub offers a free score and report from TransUnion (VantageScore). This is the only free credit score service that updates on a daily basis.
In addition to your credit score, WalletHub offers other useful services to improve your credit and financials. Customers receive free monitoring of their TransUnion account, as well as services such as customized advice to improve your credit, credit card recommendations, and savings alerts.
Credit Journey from Chase
Chase offers TransUnion scores and reports via Credit Journey. This service is freeÂ and available to all consumers (not just Chase customers). Your score is updated on a weekly basis.
Chase also tracks your score over time and has a credit score simulator that shows how your score might change if you take certain actions.
Free Annual Credit Reports
You should know that, by law, Experian, TransUnion, and Equifax are required to issue a free copy of your credit report every 12 months. Consumers who request a free copy of their report will receive a fullÂ copy, whereas many free services only offer a limited report. You can use your free annual reports to review the information included and contest any mistakes that you find.
Unfortunately, your annual free credit report does not include any actual credit scores.Â To access this information, you’ll have to sign up for a free credit score service or pay for your scores.
Annual credit reports can be requested at AnnualCreditReport.com.
Because free score services only offer scores derived from one or two agenciesÂ and don’t always offer a full credit report, it’s a good idea to also request free copies of your credit reports from AnnualCreditReport.com on a yearly basis and contest any mistakes that you have found.
That said, free credit score services are useful for educational purposes and general credit monitoring — just remember that the specific score shown is unlikely to be the same score that your creditors see. However, a free score service can give you the tools you need to improve and maintain your credit score. All the services listed above are free, easy to use, and offer useful services in addition to your credit score.
Do you need to improve your credit? Read about five ways to improve your score.
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