How do I check my self credit score?

Understanding your credit score is crucial for your financial well-being. It impacts everything from loan interest rates to approval for rentals and even employment opportunities. Checking your credit score regularly allows you to identify errors, track your progress, and make informed financial decisions. This comprehensive guide will walk you through the process of checking your credit score, explain the different scoring models, and offer tips on how to improve your score.

Why is Checking Your Credit Score Important?

Checking your credit score offers numerous benefits, including:

• Identifying Errors: Errors on your credit report can negatively impact your score. Regular checks allow you to spot inaccuracies and dispute them with the credit bureaus.
• Monitoring Your Credit Health: Tracking your credit score over time helps you understand the impact of your financial decisions and identify any potential issues early on.
• Preparing for Major Purchases: Knowing your credit score before applying for loans or credit cards allows you to anticipate interest rates and negotiate better terms.
• Protecting Against Identity Theft: Unfamiliar activity on your credit report could be a sign of identity theft. Checking your report regularly can help you detect fraudulent activity quickly.
• Improving Your Financial Literacy: Understanding your credit score and the factors that influence it can empower you to make better financial choices.

Understanding Credit Scores

A credit score is a three-digit number that represents your creditworthiness. It's based on information in your credit report and is used by lenders to assess the risk of lending to you. There are two main credit scoring models:

FICO Score

The FICO score is the most widely used credit scoring model. It ranges from 300 to 850, with higher scores indicating lower risk. FICO scores are used by approximately 90% of top lenders. The factors that influence your FICO score are:

• Payment History (35%): Paying your bills on time is the most important factor.
• Amounts Owed (30%): The amount of debt you owe relative to your credit limits (credit utilization) is a key factor.
• Length of Credit History (15%): A longer credit history generally results in a higher score.
• Credit Mix (10%): Having a mix of different types of credit (e.g., credit cards, installment loans) can be beneficial.
• New Credit (10%): Opening too many new accounts in a short period can lower your score.

VantageScore

VantageScore is another popular credit scoring model developed by the three major credit bureaus: Experian, Equifax, and TransUnion. Like FICO, it ranges from 300 to 850. VantageScore uses a slightly different weighting of factors, but the key components are similar. The factors influencing VantageScore are:

• Payment History (Extremely Influential): Paying your bills on time remains the most critical factor.
• Age and Type of Credit (Highly Influential): This considers the length of your credit history and the types of credit accounts you have.
• Percent of Credit Limit Used (Highly Influential): Keeping your credit utilization low is crucial.
• Total Balances/Debt (Moderately Influential): The total amount of debt you owe.
• Recent Credit Behavior and Inquiries (Less Influential): Opening new accounts or having numerous credit inquiries can impact your score.
• Available Credit (Less Influential): The amount of unused credit you have available.

Where Can You Check Your Credit Score?

There are several ways to check your credit score, some of which are free.

Free Credit Score Websites

Several websites offer free credit scores and credit reports. Here are a few reputable options:

• Credit Karma: Provides free credit scores and reports based on the VantageScore 3.0 model. Offers credit monitoring and personalized recommendations for improving your credit.
• Credit Sesame: Similar to Credit Karma, offering free credit scores, reports, and credit monitoring. Provides insights into your credit profile and suggestions for improvement.
• AnnualCreditReport.com: This is the only website authorized by the federal government to provide free annual credit reports from each of the three major credit bureaus (Experian, Equifax, and TransUnion). While it provides your report, it doesn't automatically provide your score. You may need to purchase your score separately.
• Experian.com, Equifax.com, TransUnion.com: You can obtain your credit report and score directly from each of the credit bureaus, although you may need to pay for the score unless you are eligible for a free report due to specific circumstances (e.g., being denied credit).

Credit Card Companies

Many credit card companies offer free credit scores to their cardholders. Check your credit card statement or online account to see if this benefit is available. Common providers include:

• Discover: Provides a free FICO score to cardholders and non-cardholders.
• Capital One: Offers CreditWise, a free tool that provides credit scores and monitoring to everyone, even if you're not a Capital One customer.
• Chase: Offers free credit scores to cardholders through its Credit Journey program.
• American Express: Provides a free Experian credit score and report to eligible cardholders.

Non-Profit Credit Counseling Agencies

Non-profit credit counseling agencies can provide credit education and guidance, including helping you understand your credit score. While they might not provide the score directly without a consultation, they can guide you on how to obtain it and interpret the results.

Paid Credit Monitoring Services

If you want more comprehensive credit monitoring and alerts, you can consider subscribing to a paid credit monitoring service. These services typically provide daily or weekly updates of your credit score and report, along with alerts for any suspicious activity. Examples include:

• Experian IdentityWorks: Provides credit monitoring, identity theft protection, and credit scores from Experian.
• Equifax Complete Premier: Offers credit monitoring, identity theft protection, and credit scores from Equifax.
• TransUnion Credit Monitoring: Provides credit monitoring and alerts from TransUnion.

Steps to Check Your Credit Score Online

The process for checking your credit score online is generally straightforward:

1. Choose a Reputable Source: Select a website or service that you trust and that provides credit scores from a reliable source (e.g., FICO or VantageScore).
2. Create an Account: You'll typically need to create an account by providing your name, address, date of birth, and Social Security number.
3. Verify Your Identity: The website may ask you security questions to verify your identity and prevent fraud. These questions are usually based on information in your credit report.
4. Access Your Credit Score and Report: Once your identity is verified, you'll be able to access your credit score and credit report.
5. Review Your Information: Carefully review your credit report for any errors or inaccuracies. If you find any, dispute them with the credit bureau that issued the report.
6. Monitor Regularly: Check your credit score and report regularly (at least once a year) to stay on top of your credit health.

What to Do If You Find Errors on Your Credit Report

If you find errors on your credit report, it's crucial to dispute them immediately. Here's how:

1. Identify the Errors: Carefully review your credit report and note any inaccuracies, such as incorrect account balances, late payments, or accounts that don't belong to you.
2. Gather Supporting Documentation: Collect any documents that support your dispute, such as payment records, account statements, or letters from creditors.
3. Contact the Credit Bureau: Write a dispute letter to the credit bureau that issued the report (Experian, Equifax, or TransUnion). Clearly explain the error and include copies of your supporting documentation.
4. Send the Dispute Letter via Certified Mail: This provides proof that the credit bureau received your dispute.
5. Follow Up: The credit bureau has 30 days to investigate your dispute. They will contact the creditor or lender to verify the information.
6. Review the Results: The credit bureau will notify you of the results of their investigation. If the error is corrected, make sure your credit report is updated accordingly.

Tips for Improving Your Credit Score

If your credit score isn't where you want it to be, there are steps you can take to improve it:

• Pay Your Bills On Time: This is the most important factor in your credit score. Set up automatic payments to avoid missing deadlines.
• Keep Your Credit Utilization Low: Aim to keep your credit card balances below 30% of your credit limits. Ideally, keep them below 10%.
• Avoid Opening Too Many New Accounts: Opening multiple new accounts in a short period can lower your score.
• Don't Close Old Credit Card Accounts: Closing old accounts can reduce your overall available credit and negatively impact your credit utilization.
• Monitor Your Credit Report Regularly: Checking your credit report helps you identify errors and track your progress.
• Become an Authorized User: If you have a friend or family member with a good credit history, becoming an authorized user on their credit card can help you build credit.
• Consider a Secured Credit Card: A secured credit card requires a cash deposit as collateral, making it easier to get approved if you have bad credit or no credit history.
• Use a Credit Builder Loan: These loans are designed to help people with limited or bad credit build a positive payment history. You make regular payments, and the lender reports your payment activity to the credit bureaus.

The Impact of Checking Your Credit Score on Your Credit Score

Checking your own credit score is considered a "soft inquiry" and does NOT harm your credit score. Soft inquiries occur when you check your own credit, when a lender checks your credit for pre-approval offers, or when an employer checks your credit as part of a background check. These inquiries are visible to you on your credit report, but they don't affect your score.

However, "hard inquiries," which occur when you apply for credit (e.g., a credit card, loan, or mortgage), can slightly lower your credit score, especially if you have multiple hard inquiries in a short period. This is because lenders see multiple applications as a sign of increased risk.