How to Check Your Credit Score
Checking your credit score should be your first step when looking for a rental apartment or buying a home.
Knowing what’s on your credit report before you apply for an apartment or getting pre-approved for a mortgage is critical to success.
Creditors report your standing monthly, so there are even chances for errors to appear on your history, which could negatively affect your score.
Why Do You Need to Check Your Credit?
It's always your best bet to have some idea of what your score looks like.
We recommend monitoring and checking your score and report on a regular basis in order to be prepared for anything.
If errors appear on your report or your credit score drops suddenly, you'll be able to check these hiccups and remedy them before they affect you adversely.
Discovering that your credit score has dropped when you're applying for a mortgage or to lease an apartment may disqualify you for either.
Where to Check Your Credit Score
Get your FICO® Scores & credit reportsGet a more complete look at your credit. View the right FICO® Scores. Monitor your credit reports for changes.
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Types of Credit Score Services
In the realm of credit reports and credit score services, there are a couple of different types of services that are offered.
Paid True Credit Score Services
When you need an exact score with fully detailed reporting, you’ll need to go to one of the three credit reporting agencies--Transunion, Experian, and Equifax.
These three bureaus can pull your true score and should have your full history.
For a monthly fee, you can have access to credit monitoring services as well as your full credit report and FICO score.
All three credit reporting agencies should pull up similar scores, with small differences. However, sometimes they can vary dramatically.
The reason they can be very different is if one of the bureaus is missing information from a creditor that another has.
This can also be true for the age of your credit history vs the age or length that another agency is showing.
If you'd like for them all to be lined up, you should report anything missing or errors yourself directly to one of the agencies.
Paid Credit Services
Free Estimated Credit Score Services
Free credit score services are a great resource to monitor and get an estimate on your credit score on a monthly basis.
While the scores given are approximations, you can get a ballpark idea of where your credit is.
You can also see all of the information that is being reported, which includes late payments, high balances, and open collections you might have.
These services may also offer good recommendations on how you can improve your credit standing as well.
Will Checking My Credit Affect My Score?
No. Pulling your own report does not have any bearing on your score.
Your credit score can only be affected when certain creditors pull your report. These are referred to as hard pulls or hard inquiries.
Hard pulls are normally run by credit card companies, lenders, landlords or property managers, or any creditor you will be paying back in monthly installments such as for a smartphone or car lease.
Too many hard inquiries in one cycle or year will bring down your score.
A soft inquiry is when a potential creditor wants to check your credit score, but are just looking for a snapshot of your standing.
Usually, it's for light purposes such as increasing your credit limit or pre-approvals for a credit card.
Some insurance companies may also make soft inquiries.
Soft pulls have no bearing on your score.
What Credit Score is Good?
If you want to be in the black, you’ll need to fall minimally in the “Fair” range (580-669) to qualify for some credit cards or mortgages.
To open most doors, you’ll need a score above 670 and above, preferably over 700 (“Good” range is from 670-739).
While “Very Good” scores go from 740-799, you can join an elite group of Exceptional credits scores which go from 800-850
If your FICO score is below 670, we highly recommend that you work on your score and your credit history to make improvements in your standing.
How Can I Improve My Credit Score?
In order to know how to improve your credit score, you need to fully understand how the model works and what goes into your credit history.
Your report will show every account you've ever had whether it's an old closed credit card account, a current loan, and whether you're in good standing with the account or have made late payments.
The types of accounts that are included but not limited to are credit cards, student loans, car loans, mortgages, personal loans, HELOCs, and home equity loans.
It even includes smaller loans like the ones people take out to purchase expensive smartphones and other installment payments through companies like Affirm.
The newer FICO score model also uses any rent payments reported by landlords.
How Your Score is Comprised
Your score is calculated by the amount of your debt, your payment history, length of credit history, number of credit inquiries, and the types of accounts you have.
Of these five factors, the two most important components you should consider the amount of debt and your payment history.
Both account for 30%, making up a total of 60% of your score combined.
How Your Debt or Balances Affect Your Credit Score
Being $30,000 in debt may sound like a lot of debt to some.
However, it's not really that straightforward. The amount you owe is measured against your buying power or credit limit.
Say your $30,000 balance is between 7 credit cards, but your combined credit limit is $140,000.
$30,000 is actually only 21% of your total limit.
As long as your debt is below 30% of the total limit, it shouldn't affect your score too much.
How Your Payment History Affects Your Credit Score
Payment history is a record of how many times you paid on time. As a matter of fact, every monthly payment is tracked.
The credit bureaus also track how many late payments you had and how late you were.
One missed payment that's 30 days late or less won't affect your score too much, although you will notice a drop.
Repeated late payments and especially if they go beyond the 30 days (in the 30-60 day late range), will see a more noticeable drop.
Lastly, anything late beyond 60 or 90 days will see your score plummet.
All late payments will remain on your history for seven years so it's important that you keep on track with all payments.
Length of Credit History
The length of your credit history is the next important component regarding your score. It accounts for 15%. The longer your history, the better.
While it is possible for you to have a credit score of 700 or higher after just one year of opening your first credit account, creditors will consider your score with a grain of salt.
You may still not qualify for some loans or even a rental apartment on your own.
If you have problems with your very first account, such as multiple late payments, do not simply close this account.
Closing this account will solve nothing as you still need to pay the balance off and will actually shorten your credit history as the account must be active for it to be considered as part of your full credit picture.
Your best bet will be to bring the account to good standing and continue to use the account responsibly.
Number of Inquiries
New inquiries account for 10% of your FICO score.
Each hard inquiry will bring down your score by a number of points. Meaning if you had 5 inquiries, you'll see a significant drop in your score.
If it's 1 or 2 during the year, it really isn't a big deal.
However, showing you have a lot of hard inquiries during the year may show a creditor that you are a risky candidate, despite a good credit score.
Types and Number of Accounts
While having one or two credit accounts may seem like more than enough, having a few more accounts, including a mix of accounts shows creditors a level of sophistication with money management.
It's possible to have an outstanding credit score with just one or two accounts, but having more accounts and different types of credit can see your noticeably score improve.
This comprises 10% of your credit score.
The average American has about 7 different accounts and creditors usually like to see a mix such as credit cards, loans, mortgages, etc.
Other Items That Can Impact Your Score
The mentioned five components are the norm when calculating your score. However, other things can also affect your score.
Bankruptcy is one of them. Filing for bankruptcy should be a last resort but sometimes it's necessary.
Unfortunately, it will decimate your credit.
It is possible to revive your credit, you'll just have to wait a minimum of five to seven years.
And even if you've put it in the past it may still be necessary to provide documentation to a creditor from the court that your debt has been satisfied or expunged.
Collections are another consideration. If you have any outstanding collections, you can rest assured that your score will plunge and the collection will appear as a comment on your report.
An outstanding collection is a red flag that will disqualify you automatically for any application.
The good news is that the newer FICO models will throw out the comment and restore your score if the debt is satisfied.
Rental payments can help or hurt your score depending on if you pay on time and if your landlord is reporting it.
Tips on How to Improve Your Credit Score
Bad credit is not the end. Below are some helpful tips on how you can get yourself back in the black.
If your credit score is low due to repeated late or missed payments, it will take some time to improve your standing as it takes five years to completely cycle out those delinquencies (seven years for serious delinquencies such as 90-day late payments).
Unfortunately, there is no substitute for this and just paying on time over time, will see your score go up.
Patience is key here.
In addition, if you have high balances, you should pay them down. You should be keeping a balance of 30% of the told credit limit and lower.
Another way to off-set the high balances is to apply for another credit card or ask for a credit increase.
If you have late payments, this probably won't be possible as your credit should be in good standing.
It's highly advisable to pay more than the minimum balance, although not necessary to pay down the full balance each month.
Keep Your Accounts Open
Sometimes, when you've messed up your payments on a card, you might place a psychological stigma on the account and think it's better to just close it.
However, if you finish paying off a high balance on a card, do not close the account unless there are high membership fees you cannot afford.
Remember that FICO likes multiple accounts and longer credit histories.
Open New Accounts
Now, you don't want too many inquiries to show up on your report, but applying for 1 or 2 new accounts in a year may help your standing.
It'll increase your score because you now have more accounts open, and it'll also increase your limit, padding yourself from any balances.
It's important that you look through each account on your credit report and make sure the history of payments and the accounts match up with real life.
Often errors can cause your score to be lower than it actually should be.
You should also get your report from all three bureaus: Experian, Transunion, and Equifax as they don't always all have the same information.
You'll need to report the errors where you find them and to the specific agency, it pertains to.
Checking your credit is vital to keeping and maintaining your credit health.
It's difficult to build or improve your credit without know what's in your report. It's a bit like driving blind.
Using a paid service for credit report access or using a free service for your estimated credit is a good way to navigate your credit journey.
In addition to these services by Federal law, each person is entitled to a full and free credit report from each of the credit reporting agencies once a year.
Even if you are monitoring your credit on a monthly basis, this free credit report gives you a complete and detailed picture of what the report will look like when a creditor pulls your history.