My Free Credit Report and Score Facts

credit score breakdown image

credit score breakdown imageYour credit report and score tell creditors how responsible you are with your finances. A good credit rating shows that you pay your creditors on time and you don’t overextend yourself with credit. A good credit rating will not only get you better interest rates on loans, but a good credit rating will also get you better home and auto insurance rates and may help you land that dream job.

Insurance companies calculate insurance risk scores based on potential customers’ credit scores. They then use these insurance scores to estimate the customers’ insurance risk. Credit risk is correlated with insurance risk, so though the practice is controversial, it is widely used. Employers regularly check the credit histories of job candidates before making the hire. A good credit rating may end up being the factor that closes the deal for that great job.

Get Your Free Credit Report

A good credit score will save you thousands of dollars over your adult life, which is why being informed about your credit score is important. By law, you have free access to your credit report from each agency once per year. The three credit rating companies, TransUnion, Experian and Equifax, all use one service for distribution of the free reports. Visit AnnualCreditReport.com and complete the

personal information form. Verify your identity with a few questions and receive instant access to all three free reports. You do not get your FICO score with any of the free reports. However, you can pay a small fee to one of the credit bureaus to get your FICO score along with your free credit report.

Free Credit Score

You can join one of several credit monitoring services. Many of these services will provide you with a trial period during which you can check your credit score for free. However, not all scores are actual FICO scores. FreeCreditScore.com provides you with a 7 day trial period for their subscription service. You receive a PLUS credit score calculated on your Experian credit history record. If you maintain the subscription, you pay $14.95 per month for the service.

Quizzle.com and CreditKarma.com are free services that provide you with a “FAKO” score and resources to build your credit. Both free services give you an instant credit score. However, the score is an estimate of your FICO score, and not the actual score. Using a free credit monitoring service is a great way to get started building or rebuilding your credit. However, when it comes time to apply for a mortgage or take out a loan for a car, you will want to know your actual FICO score from each of the three agencies.

Be sure to obtain your free credit report each year and employ a credit monitoring strategy to keep watch on your credit score. Use the free tools that are available, too. You can set alerts on your credit reports with each of the three agencies. Knowing your credit history and rating will save you money and contribute to a better future for you and your family.