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Your credit score gives you a snapshot of your financial health, and regularly monitoring it can help you spot suspicious activity and take action against fraud. Learn what to look for when you check your credit report and how to improve your score. Then get Avast One to help protect against hackers, dark web leaks, and other malicious threats that could compromise your personal information or devices and lead to problems with your finances.
Your credit score is a calculation of your creditworthiness, reflecting your ability or likelihood to repay borrowed money or credit. Your credit score is important because lenders, like banks or credit card companies, use it to assess the risk of lending you money or extending credit.
Although your credit score is primarily determined by your financial decisions, outside influences, such as identity theft, can negatively impact it. Through scams or data breaches, fraudsters can steal your personal financial information to open credit cards, loans, or lines of credit in your name. If these bills go unpaid, your credit score will drop.
Regularly checking your credit score helps keep you informed of critical changes, especially those potentially caused by fraudsters that might signal a security breach. By catching suspicious activity early, you can take action to help stop the perpetrators before they cause further harm.
You can check your credit score for free by setting up an online account with Equifax or Experian. Or, you can use a third-party service like LifeLock’s credit report and score check, which offers daily free credit checks and annual credit reports. You can also order free annual credit reports by going to AnnualCreditReport.com.
Credit scores are calculated using the FICO or VantageScore model. This, and other factors, mean your credit score may vary slightly between the credit bureaus.
Here’s how to check your credit score for free at each of the three major credit bureaus:
TransUnion: You can’t get a free credit score directly with TransUnion, but you can check your TransUnion credit score for free if you sign up for a third-party service like MoneySavingExpert’s Credit Club or Credit Karma.
Experian: Experian offers a free credit report and FICO score when you sign up for a free account on their website or mobile app. You can monitor your report for changes and see specific factors impacting your credit score so you know how to improve it.
Equifax: You can get a free credit score with Equifax by setting up a “myEquifax” account on their website. You can also find your up-to-date credit report within your myEquifax account.
Screenshot taken of the Equifax website.
A credit report provides essential information about your spending and borrowing habits. You should review all the information provided, including your credit history and accounts, payment history, and outstanding debts. This information can help you evaluate your financial health to make better informed financial decisions and help detect fraud.
Knowing how to detect, report, and prevent credit card fraud and other financial fraud can also help you avoid identity theft or mitigate future damage.
You can get a free weekly credit report for each of the major bureaus from AnnualCreditReport.com, but these won’t include your credit score. Here’s an overview of the information that’s typically included on your credit report and what to look out for:
The personal information section includes your name, date of birth, current and previous addresses, and Social Security number.
While this section doesn’t directly impact your credit score, checking your personal data is crucial. If you see an unfamiliar name or piece of information, it could indicate identity theft and lead to the thief damaging your credit score.
The employer history section lists your current and previous employers. This section isn’t present on all reports and doesn’t affect your credit score. If you don’t recognize an entry, it could indicate employment identity theft.
Your overall credit history often has the biggest impact on your credit score. This section of your credit report includes credit owed, length of credit history (current and closed accounts, payment history, current balances, etc.), new credit, and credit mix (variety of credit types, such as cards or loans).
If a fraudster has created a new account in your name, it could seriously harm your credit score as they’re not likely to pay back the debt.
As of 2018, bankruptcy is now the only public record that appears on credit reports issued by the three major credit bureaus. Chapter 7 bankruptcy remains on reports for ten years and Chapter 13 bankruptcy remains for seven years.
Bankruptcy may severely impact your credit score because it can indicate a pattern of financial mismanagement. If you notice someone has fraudulently filed for bankruptcy in your name, contact the credit bureaus and a U.S. Trustee.
The credit inquiries section of a credit report shows who accessed your information and when, There are two types of inquiries:
Soft inquiries: These occur when you or companies check your credit report without you actually applying for new credit. A soft inquiry can occur during background checks by employers or when you check your own credit score. Importantly, soft inquiries do not affect your credit score.
Hard inquiries: These occur when lenders check your credit for new credit card applications, loans, mortgages, or credit limit increases. Multiple hard inquiries can temporarily lower your credit score. If you notice hard inquiries on your report you weren’t expecting to see, someone could be applying for credit in your name.
While you should check your own credit report at least once a year, there are credit monitoring services and apps you can use to monitor it in between. This could potentially catch signs of identity theft and mitigate the fallout.
Check all the information on your credit report carefully.
You can improve your credit score by avoiding late payments, strengthening your credit utilization rate, minimizing hard inquiries, and keeping old accounts open. Here’s a breakdown of the main ways to improve your credit score:
Pay your bills on time: Consistently paying your bills on time is one of the most important factors in raising your credit score. To avoid late payments, set up automatic payments whenever possible. Creditors can only report late payments to credit bureaus after 30 days, so if you have a late payment that hasn’t reached 30 days, pay it now.
Lower credit utilization: Your credit utilization rate is how much credit you’ve used out of all your available credit. Try and keep your credit utilization below 30%, and preferably under 10%.
Avoid opening new credit accounts: Each time you apply for new credit, a hard inquiry is made, which temporarily drops your credit score. If you want to lower your credit utilization rate, you can consider opening new credit accounts or increasing credit limits to improve that area, but be strategic and time your applications wisely to avoid multiple hard inquiries in a short period of time.
Keep old accounts open: Keep old accounts open even if you don’t use them. Older credit accounts add to your overall credit history and can also be a benefit to your credit utilization rate.
Note that while the factors above impact your credit score, the following items have no impact on it: income level, employment status, debit card usage, and savings.
No. When you check your own credit score or report, it’s considered a soft inquiry. This means it won’t lower your credit score at all. In fact, checking your credit history can give you a great overview of your financial habits, which you can then use to make better financial decisions — and ultimately improve your credit score.
Help protect your identity and credit score by keeping your personal data and accounts safer online. To do this, you can freeze your credit, use strong passwords and two-factor authentication, practice general internet safety, and monitor your online accounts.
Credit Freeze: A credit freeze restricts access to your credit report, making it difficult for identity thieves to open new accounts in your name. It functions similarly to a credit lock; but there are some differences between a credit freeze and a credit lock, so check out both to see which is best for you.
Use strong, unique passwords: Weak passwords may give fraudsters easy access to your accounts and private data. Create complex, strong passwords and don’t reuse them across accounts.
Use 2FA: Two-factor authentication gives your accounts an extra layer of protection against possible breaches. That way, even if a thief does gain access to your password, they’ll still have a much harder time accessing your account.
Avoid public Wi-Fi: Don’t access personal accounts over public Wi-Fi, as the information can be intercepted by hackers. If it’s unavoidable, use a virtual private network (VPN) to encrypt your connection.
Practice internet safety: Help keep your devices and data more secure by checking that websites are safe and using reputable antivirus software on all your devices to help prevent malware from stealing your information.
Monitor your accounts: Regularly review your credit and banking statements for unauthorized transactions, and promptly report anything that’s amiss. Fraudsters can even use ATM skimmers to gain account access — so stay vigilant.
It’s not always possible to avoid identity theft. If you check your credit report and find inaccurate information or suspect fraud, dispute the errors directly with the credit bureaus and report identity theft to the relevant authorities. You should also place a fraud alert on your credit report and consider a reputable credit protection service to help keep you safer in the future.
While checking your credit score and report can help you spot fraud, your best defense and online scams and fraud is a good offense. Proactively safeguard your online data with a comprehensive security solution like Avast One. It will help keep data-grabbing malware off your devices, secure your network, and check known data breaches for compromised accounts.
One of the best ways to check your credit score is to use a credit monitoring service. You can also go to AnnualCreditReport.com to order free annual credit reports.
A credit score of 600 is generally considered to be fair or poor, depending on the credit bureau and scoring system used to calculate it. To help improve your score, use a credit score simulator to make smarter financial decisions.
You don’t have one definitive credit score — each of the three main credit bureaus determine what they consider your credit score to be based on different factors. You can check with the credit bureaus individually to find out your scores or use a third-party service to check your credit score.
