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Federal law allows you to get your credit report free once per year. To do so, go to annualcreditreport.com and request your report. You need to do this at least once a year so that you can correct any errors or missing information.
Differences Between Credit Report & Credit Score
You typically have more than one credit score depending on its use. Two of the most common are the Vantage score and the FICO score. The Vantage score uses a different algorithm from the FICO score. Places such as your employer, auto insurance company or landlord typically use the Vantage score or one similar to it. Housing lenders more often use the FICO score. FICO has as many as 60 different scoring algorithms, as does Vantage scores.
How Are FICO & Vantage Alike?
Currently, both scores range from about 300 (low) to 850 (best). In general, both Vantage and FICO use your payment history, the age of your accounts, balances versus available credit, type of debt you hold and how frequently you seek credit based on recent applications.
Types of debt can be revolving, such as a credit card; secured, like a home or auto loan; personal debt as when you take a consolidation loan, medical and education loans.
How Often Should You Check Your Scores?
While your credit report is free once a year, your credit scores from the three leading suppliers (Equifax, TransUnion and Experian) are not. But frequently, your bank, credit union, credit card providers and other financial institutions offer the opportunity to get them free. You should utilize these promotions as often as you can to keep on top of your score.
Each car payment you make — or when you pay off a credit card — changes your score. It could change by several points overnight too. Since credit “age” affects your score, don’t close old accounts. Periodically make a charge and then pay it off to keep that account active and in the mix.
New laws make it easier to see which score a lender uses too, so if you’re denied credit or offer a higher interest rate than you think you should be getting, you can check it out. When the two scores (Vantage and FICO) differ by a lot, you need to check your credit report to see what might be wrong. While it could just be the closing day of a credit card accounting cycle, it could also be something more serious like identity theft.
The closer you get to purchasing a home, the more you need to be on top of your scores. Don’t wait to review them because a problem can take a while to fix.
About the Author
Debbie Caldwell
When you first meet Debbie Harris-Caldwell, you are immediately drawn to her charming Welsh accent and the twinkle in her eye. The well-traveled transplant from Wales is quick to set you at ease and time spent with her promises to be time well spent.
Debbie has been a real estate agent for 40 years and takes great pride in her customer service skills. "I make myself available to my customers when they need me, whether it's on a Sunday Evening or after their long day at work. I make my schedule fit theirs. I also keep my customers updated on everything happening with their listings or purchase, I am their conduit for information." She has built a business following her key principles of clear communication, attention to detail, client advocacy, and comprehensive knowledge of the area. Debbie comes to every new transaction with positive energy, determination, a strong understanding of the currents driving the market, and the expertise that comes from a lifetime of experience. She knows the importance of marketing and whether a home is for sale for $200,000 or for $2 million, she always has professional photography done and creates a listing presentation that best shows off her customer's home.