When it comes to your credit report and your score, knowledge is power. The following are some facts that many consumers are surprised to learn, and by knowing more about these things, it can help you understand how your credit score is calculated and can make it easier to work towards a better credit score:
Paid accounts might not show up on your credit report
Although there are countless reasons as to why paying off your credit card accounts in full each month is always a good idea, bear in mind that your paid accounts may not always show up on your credit report. A lot of the time, it comes down to timing and when your payment history is reported. It can be reported while you’re still carrying a balance, and this unpaid balance is what will show up on your credit report. But if it is reported after you’ve just paid it off, then that is what will appear.
There are many credit reporting bureaus
When consumers think of credit reporting bureaus, the three primary agencies usually come to mind: Equifax, Experian, and TransUnion. The Consumer Financial Protection Bureau, however, has reported that while these are the three primary credit reporting bureaus, they aren’t the only ones and there are other agencies out there that collect and report similar credit history.
When you pull your own credit report, your score doesn’t drop
Hard inquiries affect your credit score, and these happen when you apply for credit and a lender looks at your credit report. However, when you pull your own credit report, no hard inquiry is made and your credit score won’t go down as a result.
You normally won’t see your credit score with your free credit report
In order to see your three FICO scores, you’ll usually need to pay a fee, as this information isn’t normally included with your free annual credit report. However, there are usually ways to monitor at least one of your scores at no extra cost. With a free Credit Karma account, you can view your TransUnion credit score. Additionally, some credit card programs provide free credit score information to customers.
You may be eligible to receive more than one free annual credit report
All consumers are entitled to a free annual credit report, but depending on your specific circumstances, you may qualify for additional credit reports for free throughout the year. For example, if you are unemployed, you may be eligible to receive an additional annual credit report at no charge. Additionally, if you were turned down for something because of your credit (for example, a job or an insurance policy), you can usually request a free copy of your credit report from that party.
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Nothing above is meant to provide financial, tax, or legal advice. You should meet with appropriate professionals for such services.