How to Check Your Credit Score and Report

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Credit reports list your bill payment history, loans, current debt, and other financial information.

It also shows where you work and live and whether you’ve been sued, arrested, or filed for bankruptcy.

These credit reports help lenders decide if they’ll give you credit or approve a loan, determine what interest rate they will charge you, etc. So, maintaining a good credit score is quite important.

In this post, you’ll learn how to check your credit score for free.

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What are good “credit scores?”

A credit score is a number that rates your credit risk.

Credit companies calculate your credit score using information from your credit report including:

  • Payment history
  • Outstanding balances
  • Length of credit history
  • Applications for new credit accounts
  • Types of credit accounts (mortgages, car loans, credit cards)

Although ranges vary depending on the credit scoring model, generally credit scores from 580 to 669 are considered fair, 670 to 739 are considered good, 740 to 799 are considered very good, and 800 and up are considered excellent. (1)

Credit Karma report found that the average credit score that first-time homebuyers needed to buy a house in the U.S. was 684. (2) Credit requirements vary depending on your state, but 684 is at the lower end of the “good” credit range.

Your free annual credit report does not include your credit score, but you can get your credit score from several sources. Make sure your credit report is accurate.

How to check credit score for free? 

I use Credit Karma!

Credit Karma is a free credit monitoring tool that can help you spot errors, inconsistencies, or signs of identity theft on your credit reports so that you can take steps to address them.

Credit Karma monitors your credit reports from Equifax and TransUnion, two of the three major consumer credit bureaus (Experian is the third). As a Credit Karma member, you can also see your free credit reports and free credit scores from Equifax and TransUnion. I really like this part!

Creating a Credit Karma account is simple and easy as well as free. Once you’ve created free credit monitoring, it will monitor your credit reports from Equifax and TransUnion on a regular basis. They’ll send you an alert or notification letting you know about any key changes, such as a new hard inquiry or a new credit card added to your Equifax or TransUnion report.

Here are some examples of errors Credit Karma will report to you:

  • Incorrect personal information, including mistakes with your name and address history
  • Payments reported that you didn’t actually make
  • Hard inquiries from lenders, credit card issuers, and other financial institutions you don’t recognize
  • New accounts such as newly opened credit cards, added to your credit reports

Please note that errors on your credit reports shouldn’t go ignored. The information on your credit reports can impact your credit scores and help determine whether you’re approved for a credit card, mortgage, or another type of loan, as well as the rates you may qualify for. Keeping an eye on your credit is a healthy financial habit.

What other free services does Credit Karma offer?

Aside from free monitoring and credit score, Credit Karma offers other services like free credit reports and ID monitoring.

Credit Karma also offers free credit reports from Equifax and TransUnion. You’ll find important credit factors from your reports that you may want to work on. Moreover, an ID monitoring tool can help you spot potential identity fraud. If your information has been exposed in a data breach, Credit Karma may alert you to any exposed passwords so that you can take the necessary steps to help keep your personal information safe.

Wrapping Up

While credit monitoring helps you keep an eye on your credit, it’s important to understand that credit monitoring can only catch activity that appears on your credit reports. I would highly recommend you to sign up for credit monitoring tools like Credit Karma and get used to it. Protecting your personal data is key to reducing the risk of identity theft too.

Resources

  1. What is a good credit score? Equifax® – United States – Evo Prod. United States. (n.d.). Retrieved January 23, 2022, from https://www.equifax.com/personal/education/credit/score/what-is-a-good-credit-score/#:~:text=Although%20ranges%20vary%20depending%20on,and%20up%20are%20considered%20excellent.
  2. The average credit score to buy a house in 2020. Paris Ward. Retrieved March 10, 2021, from https://www.creditkarma.com/insights/i/average-credit-score-to-buy-house

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