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Credit scores are funny little beasts, and it’s important to stay on top of your score. Knowing what your score is and keeping an eye on it for changes will give you a lot more ownership over the whole credit thing in general. And a credit score is essentially a numerical representation of your credit report, so knowing your score and watching it for changes makes it easy to see and understand over time how your credit is impacted by decisions you make. Open a new card? Your credit will drop by 5-10 points. A couple months later, back to normal.
So for today’s post, I’m going to run down some of my favorite options for staying on top of your credit score, what to watch out for and what to do if you notice a mistake. It’s important to note that checking your score in this way is considered a soft pull and will not impact your credit. This is unlike a hard pull that lenders perform, which will show up on your credit report and drop your score slightly.
All good? Then let’s go!
You’ve probably seen a commercial for this website at some point – it really started to gain steam a couple years ago and now you can even file your taxes through them. Credit Karma pulls your reports using the last couple digits of your social security card and runs them through a credit scoring tool. Based on the information in your reports, like recent accounts or missed payments, it spits out a number. This is what mine looks like.
Anytime I see a drop in a score like you can see on mine, you want to make sure you know why that is. In my case, I closed a couple of cards that had annual fees approaching, which will drop my score slightly.
So you might be wondering why there are two scores there, and which one you should listen to. The answer is… both of them. TransUnion and Equifax are two of the three credit bureaus (Experian is the missing one). The reason your score is different is because each report by each bureau has slightly different information on it. For example, when you apply for a credit card with Chase, they might report that to TransUnion and Experian, but not Equifax.
As you can see in the above image, this recaps my credit factors, and Credit Karma does a great job of letting you know what plays the biggest role in your score. The next tab over, Credit Changes, is a handy one to check out if you notice a change in your score to see the reasoning for that change.
And the last tab shouldn’t be overlooked – hidden in there is a neat tool called Direct Dispute that allows you to dispute an error on your report without leaving Credit Karma. This is really handy because typically you have to call the bureau, wait on hold forever, get transferred to someone, then transferred to someone else and then you can put in your dispute. I joke, but it’s a pain, so if you see an error, try this out first!
As a side note – one of the ways that Credit Karma makes money is by running advertisements and “recommendations” for credit cards. While it might be beneficial to see what cards could work for you based on your score, if you are looking to get a lot of points, never apply through their links.
Credit Sesame and Credit.com are two other sites that I’ll occasionally use to check my score as well. The scoring models they use differ a bit, but given none of them have info from all the credit bureau’s, it’s good practice just to occasionally check in on these three leading credit score sites.
I use a tool called Mint for tracking all of my expenses and income. I have all my different cards, mortgage, budget, retirement, etc. linked to Mint, so I use the app pretty regularly. A year or so ago they started providing a free credit score once a month. It provides the same basic information as Credit Karma, though it doesn’t have as many bells and whistles. It’s most handy because everytime you Mint, your score is right there.
Another nice development is that recently a lot of credit cards have begun providing this info to their customers right on the credit dashboard connected to their account. Sometimes this benefit is buried in your account somewhere, so be sure to do some digging and you might find it!
The Simple Summary
As you can see, credit score’s are more accessible than ever before, and that’s a great thing for consumers. Knowing your score and staying on top of any changes that happen to it is important. Bookmark this list and come back to it every couple months to follow the links and make sure your score is behaving the way you expect – it could save you a headache when you are looking at that new car or house!