Credit score is a three-digit number that represents your ability to pay your creditors. Having a good credit score can result in getting your loan application approved. When it comes to getting a good score, you need to aim high. This means that a higher credit score is equal to being a better borrower.
Your credit score is based on the information collected by consumer reporting agencies. Contrary to what most people think, you can get a good glimpse of your credit score. In fact, there are free credit score government agencies that provide scores to individuals so that they can check their score. This allows them to determine if they can get their loan approved with better interest rates.
Credit Score Vs. Credit Report
Credit score and credit report may sound the same, but they have different objectives. While a credit report is used to track an individual’s financial activity, a credit score is a numerical reflection of a credit report. The latter does provide an overview of a person’s paying ability, while the former provides a clear picture of the financial history of individuals. Nevertheless, financial institutions use a credit score to determine the risk of a borrower.
Is It Free Or Not?
While Federal law dictates that consumers have the right to get a free credit report, the law does not give any stipulations on getting a free credit score government subsidized. Although this may be the case, this does not mean that you cannot get credit scores for free.
Government agencies can provide a free preview of your credit score. In fact, you don’t need to purchase your FICO score to get your credit score. You can get a preview on sites like Creditkarma, Credit, CreditSesame and Quizzle.
Although these credit score companies are not affiliated with the free credit score government agencies, they allow you to check your score as often as you want and without any cost at all. However, the caveat is, the scores might be inflated by as much as 70% more than your actual FICO score. Another way to get your free credit score is to request a copy of your FICO score from free credit score government agencies like banks. This is especially true if you are applying for a credit.
Even though the credit score companies mentioned here do not provide a credit score close to your FICO score, they can still be used as an indicator for your credit health.