How to check your credit score
Here’s how to monitor your credit score for free
Knowing your credit score is almost as important as knowing your birthdate. The three-digit number sums up your creditworthiness for lenders, financial institutions and even landlords. This number determines if you are eligible for financing and at what rate.
Even if you aren’t buying a new car or home today, it’s a good idea to check your credit score periodically and take action if your credit score isn’t as impressive as you hoped it would be.
Key insights
- Your credit score is not a static number; it can change over time based on various factors.
- Regularly monitoring your credit score enables you to spot any signs of potential identity theft or fraudulent activity.
- Your credit score is a number calculated by your payment history, credit utilization, length of credit history, credit mix and new credit applications.
How can I check my credit score?
There are several ways to monitor your credit, and many of them are free. If there are any additional services you need, such as identity theft protection, you can pay for a credit monitoring service.
- Check your credit card or bank statement: Many major credit card companies provide your credit score for free on your monthly statement. If it’s not listed on your statement, log into your online account to check.
- Talk to a nonprofit credit counselor: It’s free to speak with a nonprofit credit counselor. They can get you a free credit report that shows your score and help you understand the details.
- Use a free credit score service: Some credit report sites are funded through advertising and don’t charge a fee.
- Pay for a credit monitoring subscription: Some credit monitoring sites require you to sign up with a monthly subscription fee. These sites may offer additional services like identity theft protection and credit monitoring.
- Get your free annual credit card report: Thanks to the Fair Credit Reporting Act, you get one free credit report every year from each of the major U.S. credit bureaus: TransUnion, Experian and Equifax. Your actual score isn’t on your free credit report, but you can get an idea of what factors are influencing your score by going over the report.
» MORE: What is a good credit score?
What should I look for when checking my credit score?
Scott Nelson, the managing director of MoneyNerd, says the first thing you should look at when checking your score is which range it falls in.
“This will normally range between 300 and 850, so if your score is closer to 850, then you know you're in a better financial position,” Nelson said.
If your score is not as high as you would like, Nelson recommends “that you check through your payment and credit history. These will drastically affect your overall credit score.”
Additionally, your credit report could hold the answers as to why your score is the number it is. You can request one free credit report per bureau per year. This will allow you to see any negative marks or dispute any mistakes that are weighing down your credit score.
One ConsumerAffairs reviewer from Texas said: “I knew very little about how the impact of certain transactions affected your credit score. Because of [credit monitoring company], I try very hard to make sure certain things such as late payments and charge-offs steer clear from my credit report. The extra effort of calling a creditor and making a payment is well worth it.”
Why does your credit score matter?
Your credit score can either help or hurt your financial situation. It is a three-digit score that represents your creditworthiness, and lenders use it to determine if you are financially responsible.
A good credit score indicates responsible financial behavior, making it easier for you to secure the best interest rates, higher credit limits and better loan terms. On the other hand, a poor credit score can limit your financing options, leading to higher interest rates, lower credit limits or application denials.
FAQ
How often should I check my credit score?
If you have regular, free access to your credit score, checking it monthly can help you improve it or fix any issues immediately. It is also a good idea to request your full credit reports once a year to ensure accuracy.
Will checking my credit score lower it?
No, checking your own credit score is considered a soft inquiry and does not impact your credit score. When lenders or credit card companies check your credit as part of a loan or credit application, it results in a hard inquiry and can affect your credit score.
Do credit monitoring services affect my credit score?
No, credit monitoring services do not impact your credit score. These services track changes to your credit report and provide you with alerts and insights, but they do not directly affect your creditworthiness.
What should I do if I find errors on my credit report?
If you discover errors on your credit report, it's essential to take immediate action. Contact the credit bureau(s) reporting the errors and provide them with any supporting documentation to correct the inaccuracies.
Bottom line
It’s good practice to keep track of your credit score, even if you aren’t in immediate need of a new loan. Knowing your score lets you know what kind of loan to expect from your lender or how likely a property manager is to rent you an apartment or house.
If you aren’t happy with your score, there are methods to build your credit score or fix your credit score.
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