How To Get Your Credit Score For Free!
(really - with no strings attached)
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Have you ever wondered why you can go online or into a store and be approved for credit right away? Or how you can get pre-qualified for a loan just by answering a few simple questions? Or why you get one interest rate on loans, while other people you know get a different rate?
Well, it's all possible because of something called a credit score (or FICO score).
Nearly all of us have a credit score. If you've ever had a credit card, a mortgage, a car loan, or rented an apartment, then someone has used your credit score - to determine how much to lend you, how high an interest rate to charge you, or to turn you down entirely.
How Is Your Credit Score Determined?
They are based on a formula that takes information found on your credit report. The more positive your credit report, the higher your credit score. The more money problems found on your credit report, the lower your score. And higher is definitely better!
Unfortunately, figuring out your credit score is nearly impossible to do on your own. And to make it even more confusing, each of the three major credit bureaus uses their own calculations to come up with your score:
Equifax uses the BEACON score
Experian uses the Experian/Fair Isaac Risk Model
TransUnion uses the EMPIRICA score
Each of the 3 can give you a different score because they use different factors. Its way too confusing for most people! Fortunately, there is a way to get your score without having to do the math.
Why Is Your Credit Score So Important?
Because your credit score determines whether or not you get credit! And because is determines the interest rate your pay on all of your loans and credit cards. Therefore, it can either save you money - or cost you money - all depending on your score!
For example, consider a person who is looking to buy their first house.
Let's say they're looking for a standard 30-year mortgage, and their FICO score is 720. They might qualify for a mortgage with a 5.5 percent interest rate. But if their score is 580, they might only qualify for a 8.5 percent rate (or higher). That's at least 3 full percentage points more in interest. And on a $100,000 mortgage loan, that 3 point difference will cost them $2,400 dollars a year, adding up to $72,000 dollars more over the loan's 30-year lifetime! (Note: these numbers are just used as an example, and can change from year to year and from person to person).
That's a huge difference!
So, What Is A Good Score?
The scores range from 300-850. In most cases, a score above 700 is considered very good. You may need a 720 or 750 to get the best rate, but you are in good company. Scores in the 600 range are OK, but will cost you. You'll get a higher interest rate, and may not qualify for all types of credit. Anything below 600 is a red flag to lenders - meaning you are a high risk, and will either get charged a much higher interest rate, or you'll be turned down completely. You'll need to work on fixing your credit report so you can raise your score.
OK, Then How Do You Find Out Your Credit Score - For Free?
The only truly, 100% free credit scores I could find are listed below. Many websites or ads offering "free" credit scores make you sign up for some other service, like credit monitoring or something like that. Those services are NOT free, so beware!
Free Credit Score - Quizzle.com
Free Credit Score - CreditKarma.com
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