Like many people, you may think if you order your credit report, you will also learn your credit score. Unfortunately, this is not the case. Your credit report contains your credit history including your credit account information, credit limits, payments made, credit inquiries, and public record information (bankruptcies, civil lawsuits, etc.). Your credit score is the calculated three-digit number based on this financial history. Therefore, while your credit report and credit score are related to one another, you will not learn your credit score by way of your credit report. By reading this article, you will know how to learn where your credit score stands and you can improve your score.
Did you know you have multiple credit scores?
Before we talk about getting your credit score, you should know you don’t have just one credit score. Just like there are variations of credit reports, there are various formulations of scores. Many credit bureaus including the big ones (Equifax, Transunion, and Experian) capture your credit information. The data can be different due to many factors such as creditors nor reporting all information to all credit bureaus. Because of this, credit information may be slightly different. In the same way, the scores based on these reports may also be slightly different.
Here’s why there are many versions of scores:
- Various credit report sources – The resulting score can be slightly different dependant on which credit reporting agency is used.
- Various score providers – FICO and VantageScore are common score providers but there are many. Each score provider has their own proprietary formulas. Your score may be somewhat different depending on which score provider is used.
- Credit score purpose – Depending on the loan you seek can produce a different credit score. There are specific scoring models used whether you are applying for a mortgage loan versus a car loan, etc. Additionally, credit bureaus, private lenders and subscription-based credit services have developed an educational credit score formula that will provide you, the consumer, a score. This is slightly different than the score formulas that are used to provide to creditors.
Do you have to check all versions of your credit score?
No. It would be an impossible task to check all versions of your credit score. Generally speaking, your credit scores should all be fairly close to one another. It is wise to check the basis of your scores by getting a free copy of your credit report from the big three credit bureaus every year. Therefore, by monitoring your report, you are can correct any errors that could affect your score and make necessary improvements such as debt reduction or improving your payment regularity. Some advise if you are about to make a large purchase, such as a mortgage, you should be aware of your score to make any necessary improvements prior to applying.
Where do you learn your credit score?
There are a few ways you can find out where you stand as far as credit score goes.
- Check your credit card, bank or loan statement. Many credit card companies, banks and loan companies have begun providing educational scores to provide you with a basic idea of your creditworthiness. Sometimes your score may appear on your statement or online account.
- Purchase credit scores directly. You can opt to buy your score from one of the three major credit bureaus or other credit score provider, such as FICO.
- Sign up for a credit score service. Some sites provide a free or subscription-based credit services that offer sharing your credit score information.
To summarize, it can be challenging to keep on top of your credit status. While you may be curious to know your score, the best solution is to check your credit report each year to ensure your financial information is accurate. Reading your report will also provide you with the knowledge of where you stand on things such as making consistent payments and overall debt. This will allow you to make changes to improve your financial situation.