Get Your Free Credit Score at CreditKarma.com

I’m always nagging at you to check your credit report, which you can request for free at AnnualCreditReport.com.  But up until now you always had to pay for your credit score.

Well, I recently discovered a website called CreditKarma.com, where you can request your credit score (the actual 3-digit FICO score) for free.

I was concerned that there might be strings attached, so I had to check it out for myself.

The registration process was very quick and easy, and the application to retrieve your credit score was much easier than the process to request your credit report from one of the three reporting agencies.

20% Off Your Complete Credit Report and Score from MyFICO.com

I’m always telling clients to check their credit report on a regular basis, to check for errors, or worse – identity theft.

You should check your credit report at least once per year, but several times a year would be better.

To check your credit report for free, go to www.annualcreditreport.com.  You won’t be able to get your credit score for free, but this does allow you to view your report from one credit reporting agency without cost.

If you want your complete credit report (from all three credit reporting agencies), along with your credit score, a good resource is MyFICO.com.

Debit Card Fraud Much More Damaging Than Credit Card Fraud

While I was on vacation this week, some thief was busy emptying out my checking account.

I have always loved the convenience of debit cards, but this recent experience has me re-thinking the cost of that convenience.

First, your liability if you are a victim of debit card fraud is greater than if someone steals your credit card or uses your credit card to make unauthorized purchases.

With credit cards, your liability for unauthorized transactions is limited to $50. However, most major credit card issuers have a zero liability policy, so you typically aren’t liable for anything if you are a victim of credit card fraud.

With debit card fraud, your liability is limited to $50 only if you notify your financial institution within two business days after realizing their card has been lost or stolen. After that, your liability is limited to $500 if you report any suspicious activity within 60 days of receiving your account statement. After 60 days, your liability is unlimited, so it’s very important to check your statements on a regular basis.

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Now’s a good time to check your credit report

Now that the holidays are over, it’s a good idea to check your credit report. Unfortunately, the holidays are a peak time for credit card fraud and identity theft, and checking your credit report is sometimes the only way to catch fraud.

You can check your credit for free at www.annualcreditreport.com. This report does not include your credit score but it can be purchased for $12.

There are three credit reporting agencies, and each of them is required to give you one
free report per year. Which means you can actually get 3 free credit reports each year, by requesting 1 report from each reporting agency. I suggest that you stagger these requests out over several months, rather than requesting from all 3 reporting agencies at once.

How Inquiries Affect Your Credit Score

Many people wonder how inquiries affect their credit score?  Does it hurt your credit score to check your credit, or if a potential employer checks your credit?  Here’s the scoop on how inquiries affect your credit score…

Ten percent of your credit score comes from applications made to your credit report.  Each time a creditor or a lender takes a look at your credit report to determine whether or not to extend you credit an additional inquiry is placed on your credit report.

If you’ve checked your credit report lately, you may have noticed inquiries from businesses you might not have heard of.  Not all of these inquiries have an effect on your credit score, so don’t panic!

The inquiries that DO affect your credit score are those from your own credit applications.  When you apply for a credit card, auto loan, or mortgage, you give the lender permission to look at your credit report.  This places a voluntary inquiry on your credit report and these are the inquiries that do have an effect on your credit score.

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What makes up your credit score?

A few days ago I posted about creating credit resolutions for the new year.  I thought now would be a good time to review what makes up your credit or FICO score.

There are five key elements that comprise your credit score: payment history, outstanding debts, credit history age, inquiries, and account types.  Each of these items is weighted differently when calculating your FICO score.  Payment history is 35% of the score, outstanding debt is 30%, credit history age is 15%, and both inquiries and account types are 10% of your total FICO score.

So… what do each of these elements include and more importantly, what’s considered good and what’s bad for each component?

Payment History
Your payment history includes the details of how you’ve been paying your bills – i.e., whether you’ve been paying them on time, or even at all.  Each of your creditors reports your payments as on time or late.  Late payments are reported as being 30-, 60-, 90-, and 120-days late.  After six months of non-payment, many creditors charge-off your account, deeming it as uncollectible.  The more recent the late payments are, the worse the effect it is on your credit score.  Timely monthly payments boost your score in this area.

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Credit Resolutions for the New Year

One way to cut the sting of the post-holiday credit card bills is to set a new agenda when it comes to credit.  So consider the following ideas when setting your credit resolutions for 2007:

Set dates for getting your credit reports: Each year, you should check each of your credit reports from annualcreditreport.com directly.  You should spread out your requests, making requests quarterly so you can catch errors that might come up at different parts of the year and spot identity theft.

Get your credit score once a year: A credit score is a three-digit number that reflects the credit history detailed by a person’s credit report.  Go to www.myfico.com to retrieve your credit score once a year from one or all of the three credit bureaus.

Continue Reading Credit Resolutions for the New Year

How to Get Your Free Annual Credit Report

Unfortunately the
holiday season usually brings an increase in credit card fraud and
identity theft, so right after the holidays is a great time to check
your credit report.  Following is why, when and how to check your
credit report…

Why you should check your credit
report

• to check for errors
• to check for fraud and identity
  theft
• to get the best interest
  rates
• more and more people are relying on
  credit scores – car insurance, employers, etc.

When to check your credit
report:

Building Good Credit with Secured Credit Cards

I’ve gotten several emails lately from people who need to build credit, either because they are young and don’t have any credit history, or they have had a bankruptcy or bad credit in the past.

One of the best ways to build or rebuild your credit is with secured credit cards.

What is a secured credit card?

A secured credit card is where you give a bank a security deposit – $500 for example – and receive a credit card with a $500 limit on it.  You use the secured credit card the same way you would any other credit card and make regular monthly payments to pay off any money that you spend using the card.

Getting Your Free Annual Credit Report

I ask all of my clients to request their annual free credit report to make sure that there aren’t any errors on their credit report, or worse, that they haven’t become a fraud or identity theft victim.

The website to obtain your free annual credit report is www.annualcreditreport.com.

I recently saw an article in the Kansas City Star that addresses common questions or problems that people have when requesting their credit report.

Click here for tips on getting your free annual credit report.

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