The credit score is one of the crucial aspects of personal finance. The credit score is vital in many ways. It is required to know the score before applying for a mortgage, personal loan, or new credit card. The credit score determines your qualification and expected interest rate and product.
There is an ignorant about credit score; a lot of people believe that they cannot check the credit score without applying for it. But you can easily check the score whenever you want without even applying for the card or loan. In our today’s article, we will let you know How to View Your Credit Score For Free.
What Is The Credit Score? Why is it Important?
The credit score is a three-digit number, which is based on the analysis of your financial condition. The number generally varies from around 300 to 850. The number is typically used by the lenders to determine your ability to pay the loan and your potential credit danger. Credit score depends on a lot of aspects, including credit history, payment history, current and previous credit accounts.
There are two models in the credit score, which are FICO and VantageScore. The credit score of around 300 to 579 is considered very poor. The credit score of about 580 to 699 is fair when 670 to 739 are considered as good. If the credit score varies around 740 to 799, then it is very good, and if it is approximately 800 to 850, then it is exceptional.
How to View Your Credit Score For Free
Fortunately, there are multiple ways to check your credit score for free. Below, we will let you know about different ways of checking the credit score:
Check from the online website: There are a large number of websites that allow you to check the credit score in the easiest way. Such as the credit-wise from capitalone lets you easily check the score from there website by signing up for an account. There are also android and iOS apps for checking the score. It offers you a TransUnion credit report along with the other features.
More so, you can check the FICO score through the Experian website. Some other websites let you easily monitor and track the credit score. To check the VantageScore, you can rely on the chase credit journey website. You can easily access the website by searching on google.
Check with credit card lender or issuer:
One of the easiest ways to check credit score is through the credit card or loan issuer. Especially if you own a credit card, then you can easily know the credit score from the card or loan lender. Checking the credit score also doesn’t require a lot of time. All you need to do is browse the card provider website and navigate to the credit score section. There you can see the score by log in to your account.
Non-profit credit counselor:
There is some non-profit credit counselor that allows you to know the score for free. You will need to provide some details, and they will find out the score for you. National Foundation of Credit Counseling is one such non-profit credit counselor.
How is the Credit Score calculated?
As we said earlier, there are two models of the credit score, which are FICO and VantageScore. However, most of the lenders prefer the FICO model than the others in the U.S. Though, both models are almost similar, they range from 300 to 850, and payment history is crucial in both models. There are differences in the weight and the other factors in these two models.
FICO Model
Below, we will let you know the influential factors in the credit score on FICO model:
- Payment History: As we said earlier, payment history is the most influential factor in the FICO model. In the payment history, the lenders basically check whether or not you have paid the cleared the credit in time. Regularly paying the bills will give you a positive score when paying late will cause a negative score. The credit score depends on the payment history by 35%. You can keep the score high by paying the credit on time.
- Amounts owed: The amounts owned or amount debt is another crucial factor in credit cards. It can be easily calculated by dividing how much credit you are holding by the amount of total available credit. By knowing the debt amount, you can easily keep it lower for better results in credit score. Credit score depends 30% on Amounts owed.
- Length of Credit History: Here, the length of credit history means the period of time you have to hold the credit. The credit score depends on 15% on it.
- Credit Mix: It means all the types of credit products you have. Credit mix includes credit card, mortgage loan, installment loan, finance company account, and others. The credit score depends on 10% on it.
- New Credit: It means how frequently you apply for the credit and opens new accounts. The credit score depends on 10% on it.
VantageScore
In the VantageScore, there is no percentage. The scale is given below.
- Less Influential: Recent credit and available credit inquires and behavior.
- Moderately Influential: Debt or total balances.
- High Influential: Duration and type of credit and quantity of credit limit used.
- Extreme Influential: Fee (Payment) History.
How to Improve Your Credit Score
Here are the steps that you can take to improve your credit score:
- Complete the credit payment on time. If you can pay the bill regularly for six months, you will see a noticeable change.
- If you are currently holding a credit account that you don’t need, then stop the account instead of canceling or closing it. Closing the account may lower your credit score sometimes.
The credit card score is a very important number, which shouldn’t be ignored, especially if you are holding a credit card or have an on-going loan. Hopefully, the above details about the credit score will be helpful for you.
Leave a Reply