Why is my Credit Score Important?Maintaining a positive credit profile along with a high credit score is veryimportant when shopping for a new home or auto loan. For those of you that use credit cards, a higher credit score helps secure lower interest rates on your cards as well. A credit “score” is a number that represents your overall credit worthiness. A high credit score is crucial to obtaining financing from a big bank.
|How am I scored?A credit score is derived through complex formulas that consider things like number of open accounts, payment history, balances relative to credit lines, and so on. The credit bureaus keep these formulas confidential. They key to building a great credit score is to have a mortgage, an auto loan, and maybe a credit card – and to pay them consistently over time. The key is to always keep your payments current. Using this approach, the score will go up over time.Credit Report, Credit Score, & Credit Monitoring ServicesObtaining a free credit score can be done annually under government laws. These do not, however, offer a credit score, or any additional services. They are only useful for reviewing your credit report to ensure it is being reported accurately.By using trial credit monitoring services you can also obtain a free report, get your credit score, and also use credit monitoring services to monitor major changes to your credit report. Monitoring will alert you to fraudulent activities such as somebody else opening an account in your name.
The problem is that consumers are often roped into misleading and misrepresented services provided by less than reputable companies. These services can be nearly impossible to cancel and have automatic monthly billing.
Many of the websites boasting free credit reports and scores are offered by independent third parties and are often misleading about what they include, and how much they charge. They might hit your credit card with hidden charges after the free trial, without you even realizing it. They usually have inadequate call center staffing, so again, cancelling is very difficult.
Others promise to give you the product, but then their websites fall short of delivering a usable product. You should always take care to make sure you are using a subsidiarity of one of the major credit bureaus. They are held to high security standards and have done this for years.
I have used at least a half dozen credit monitoring services and will give you my personal recommendation today.
The following is a list of things that you should consider before you order a credit report, score, or subscribe to a monitoring service:
- Is the provider a known company with a good reputation?
- How much is the up-front cost?
- How much is the monthly fee?
- Is this charge for one credit report, or all three?
- Is my credit score included? How about for all three bureaus?
- Does this product include credit monitoring?
- Do they have a cancellation phone number available on their website?
Is the provider reputable? One of the most important things to remember is that you’re not only purchasing a product from these companies. You are trusting them with your name, address, credit card information, birthday, and even your social security number. It’s scary enough providing this info to a known credit reporting bureau. When thinking about all of the “new” credit report providers popping up every year, are you really going to trust that fourth party with this information in addition to the credit bureau? I hope not!
How much is this going to cost? You must be careful regarding costs! Most companies offer something a package with no up-front cost, and later bills you a subsequent monthly fee. Make sure you understand what you are signing up for! Many providers purposely make it painful to contact them and cancel the service. (I must reiterate this point!)
What are you really buying? Make sure you understand what you’re purchasing. Don’t compare only the price, but also look at what is included in that price! Some companies offer a free credit report, but don’t tell you that you have to pay extra to see your score! I’m willing to bet that over half of the consumers that purchase their credit report are more interested in their credit score than the report detail itself.
Also understand that there are three major credit bureaus, but not all creditors report to all three. Another thing to consider is whether you get one report, or all three. If you need a 100% accurate picture of your credit profile and scores with each bureau, you need a 3-bureau report. If you just want a good idea of what your overall credit profile looks like, and what your score is, then a single bureau report and score is a more economical option that should meet your needs just fine.
Another service that many providers offer is credit monitoring. Credit monitoring services alert you of any significant change in your credit profile. For example, if a new account is reported, an old account closed, a balance suddenly goes very high, and so on, the monitoring service will send you an e-mail, US Mail, or text message notification of the alert. Does this cost extra, or is it included? Is the monitoring service checking your credit profile every day, or just once or twice each month? There’s a lot to think about!!
How do I cancel? This is the question that many people find themselves searching for an answer to after they buy a credit product. The answer is often hidden deep within a website on a page that may only have one link to it. Regardless of the provider, you almost always have to call to cancel. Once you call in, the pressure is on to keep you a subscriber! They’ll do almost anything to get you to agree to let them extend the service for an additional month, free of charge! Please remember this when you choose a company to trust!
My Personal Recommendation:
Having done business with subsidiaries of each of the three credit bureaus, as well as with other third party agencies, my vote is to go with CreditReport.com. CreditReport.com is a subsidiary of Experian, which is (in my opinion), the most innovative of the three credit bureaus.
An advantage of using CreditReport.com is that by default, if you order a 1-bureau report, it will utilize your Experian report. In my experience, of all of the companies that report your credit information to only one of the three credit bureaus, they generally report it to Experian. This is advantageous if you only want to monitor one report & score.
CreditReport.com has a very up-front fee structure, with promotions that vary from time to time. At the time I wrote this, you can sign up for a 7 day trial which will include a free copy of your Experian credit report, your Experian credit score, and access to their credit monitoring service. If you cancel within the first 7 days, they will not bill you for the service.
If you want to remain a CreditReport.com subscriber to take advantage of the credit report monitoring and being able to see your up-to-date credit report and score any time you want, your membership will continue at $19.95 per month. Of course, you can upgrade to the 3-bureau report for an additional $10 each month.
Those prices aren’t out of line for being able to keep tabs on your credit. But, I mentioned earlier that you can generally get a special offer if you call to cancel the service. A few months ago, I called to cancel my service, and they made me an offer for a much lower monthly rate. I now enjoy all the features of the $19.95 monthly subscription for only $9.97 per month. I simply called customer service at 1-877-297-7790 to cancel and they quickly presented this permanent rate.
Just to recap some of the benefits of using CreditReport.com:
- Up-to-date credit reports (can be refreshed daily after the trial membership)
- Up-to-date Experian credit score (can be refreshed daily after the trial membership)
- Credit Monitoring & Alerts — Updated daily!
- Credit Score Monitoring & Alerts (bi-monthly)
- Fraud Resolution Support Service
- $50,000 Product Guarantee
- If you find inaccuracies, they have a system to help you dispute the item
So in summary, it is important for each consumer to understand the contents of his or her credit report. Knowing what is there can help you prevent identity theft, and help keep your credit in tip-top shape by seeing what your creditors are posting each month. (You never know when you’ll need a loan in a pinch!)
I have spent time and money researching and evaluating several credit monitoring services, and wrote this review to provide you with an overview and my personal recommendation. If you subscribe to CreditReport.com, please give me the courtesy of using any of our CreditReport.com links in this blog so we get a couple bucks for sending you their way! Again, I applied to be an affiliate partner with this service because they are exactly as I have portrayed!
Thanks for taking the time to read this. Feel free to leave comments below!