How to Check Your Credit Score Easy and Free
There’s a website where you can check your credit score online and for free:
You can check your credit score report anytime and print it for your records if you want to!
This website is really good and I use it frequently. You can view your report in a very easy and friendly way.
- An email reminder once in a while, to check your credit score.
- Tools to help you make the most of your credit.
- Recommendations to improve your credit.
What is the Credit Score?
A numerical expression used to represent the creditworthiness of a person, or the likelihood that you’ll pay back your debts.
Your score can affect whether or not you are approved as well as what interest rate you are charged when applying to a:
- Credit Card
- Student Loan or
- Other Line of Credit
How Reporting Works
Why Your Credit Score Matters?
It tells if you are reliable and responsible.
Having a good credit can make it easier to:
- have a home
- buy a car
- get a good job
- borrow money when you need it
- it can affect what you pay for insurance
You might want to check out more about the importance of your credit score.
Reasons Why Your Credit Score May Drop
Credit card utilization
A significant amount of debt on your credit card could be one of the reasons.
If you miss even a single payment, it may have a very negative impact on your score.
Tax liens, accounts in collections and bankruptcies are among the most serious things that can happen to your credit score.
The average age of open credit lines
If you’ve closed an account recently, your credit history may appear shortened and your score might drop. Opening a new account could also lower the average age of your accounts.
A good mix of different types of credit and an appropriate number of open accounts show lenders that you have the experience to pay off debt responsibly. If you’ve just paid off the only loan you have, your credit mix might look a little less diverse. Or, if your total number of accounts suddenly skyrockets, that could indicate that you’re financially strapped and need a credit or can’t afford your existing credit accounts.
Hard credit inquiries
When you apply for a new form of credit (a credit card, auto loan or mortgage) a hard inquiry is placed on your credit report and may cause your score to drop a few points. However, if you’ve applied for several accounts in a short period of time, you could appear desperate for credit, and the damage from those hard inquiries might add up.
To know more about each item mentioned above click here.
If you want to read more details about why your credit score dropped and possible solutions click here.
Some Tips to Fix a Poor Credit
You should check your credit score report and see if all the information is correct. If you see something wrong, dispute it. Some errors may have a negative impact on your credit score.
Common errors in credit reports:
- Outdated personal information
- Mistaken or fraudulent accounts
- Incorrect account detail
What you can addressed, assuming that everything in your report is correct:
- Settle your debts. Priority: past-due debts or in danger of becoming delinquent. Read more about it here.
- Keep credit balances to less than 30% of your total credit limits.
- If you recently missed a payment, make sure it doesn’t happen again!
- A lot of hard inquiries on your credit score will have a negative impact on your report (every time you apply to a credit card or a loan). Avoid applying for a lot of credit in a short period of time.
- If you’ve never established credit, consider opening a secure credit card to start building it!
- Once you’ve cleaned up your credit report: start fresh with a secure credit card to start improving your credit health.
How to build credit to buy a house?
Click here to read more about it.
- Check your credit score: to know what you need to improve to get the best rates possible. You need at least 660 credit score to get approved by landlord. If you want to get the best interest rates and save the most money you need at least 720 credit score.
- Improve areas of your credit report card: you can check them on CreditKarma.com for free! They give you recommendations to improve your credit and you can see what’s working and what’s not.
- Your daily credit actions affect your credit score: before buying a house, take the next couple of months to build your credit score. E.g. pay off your debts, use your credit card better.
- Be patient. It takes time to build excellent credit! It can take a few months or a few years. If you want to save thousands of dollars of the life of your mortgage, building up a credit score is the way to go.