Check Your Credit Score For Free – Myth or Fact?
I know, I know…. as consumers we are constantly barraged with offers for “free” products or services that almost always wind up with you giving them your credit card number for that “free” trial and then having to spend some frustrating time getting that brand new account that you did not want cancelled and refunded.
This has lead to consumers being very skeptical of these free offers and frankly, I feel that our skepticism is more than justified. Credit reports have a particularly bad reputation as some credit card companies use the offer of a “free” credit report or score to sell expensive credit monitoring or other subscription services. One glaring example is FreeCreditReport.com which is owned by Experian. Since 2005, Experian has paid the Federal Trade Commission $1.25 million to settle charges that its ads were misleading.
However, there are several companies that provide a credit profile at no cost to the consumer. The score you will get from these sites is NOT the widely used FICO score that lenders use when you apply for a mortgage, credit card or car loan, but if you are curious about your credit standing in 2010 these sites will give you a useful snapshot of where you currently stand. It will also let you know if you need to clean up your credit.
The websites that I am referencing below do not require you to enter a credit card number so you are in no danger of signing up for a service that you don’t want. However, they do appear to rely on advertisements as their revenue model, so be prepared to see a LOT of advertisements for credit cards, mortgages and other credit products.
Credit.com
Credit.com’s “Credit Report Card” tells you whether your score is bad, poor, fair, good or excellent. It also tells you how this translates into an actual credit score. For example, an excellent rating would translate into a FICO score of 750-850.
This site does a pretty decent job of breaking down the information used to determine your grades. For instance, under “payment history”, you will be able to see just how many late payments appear on your credit report.
Credit.com uses information from TransUnion.
Credit Karma
Credit Karma.com will give you an idea of whether lenders consider you an excellent, average or poor risk. You will also get a report card grading different components of your credit score, such as payment history.
A really nice feature of this site is that you can update your score as often as you like. If your goal is to clean up your credit, this will help you gauge your progress and make some course corrections as needed. Another feature of this site is the “credit score simulator” which shows how various financial transactions affect your credit score. If you are planning on applying for a mortgage in the near future, this tool will help show you what you can do to improve your changes of getting a decent interest rate on your mortgage. This is the only totally free credit predictor that uses your actual credit score to get more accurate results.
This site uses information from TrueCredit, a division of TransUnion.
Quizzle
Quizzel’s credit score is based on information obtained from Experian, so when you sign up with them you will also get a free copy of your Experian credit report.
Quizzel subscribers can get an updated Experian credit report and Quizzel score every six months. If more frequent reports are needed, it will cost you $7.95. This site will give you grades in several categories; mortgage, budget and rainy day fund to name a few. You will receive an analysis of each category, along with suggestions on how to raise your grade.
Unlike the other sites mentioned here, you don’t have to type in your Social Security number. Quizzel uses information you provide and asks targeted questions to locate your credit report. However, if the information you provide delivers more than one credit-report match, you may be asked to provide your SS number.
How to Improve Your Credit Score
1. Pay your bills on time.
2. Have at least three to six active accounts.
3. Keep credit card balances low.
4. Avoid closing credit cards, especially accounts you’ve maintained for a long time.
5. Avoid applying for new credit
Source: Credit.com
I am not suggesting that you use a free credit score as your only means of monitoring your credit. You should periodically review your actual credit report by going to AnnualCreditReport.com. The credit bureaus are required by law to provide you with a free credit report every 12 months through this website. By scheduling credit maintenance just as you would schedule auto maintenance you won’t find any nasty or costly surprises.
**You have permission to reprint in your publication or to your website/blog any articles by Theodore Henderson found on this website as long as Theodore Henderson’s name and contact information is included. Theodore Henderson, Faith-Based Business Consultant and Author. Website: http://thjassociates.com, henderson.theodore @ gmail.com.
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