The era of having to pay $19.99/mo to monitor credit score & activities is gone! Credit card companies are offering free credit score and selective credit activity details let & right. One can get great sense of his/her credit health as well as how to improve credit score & borrowing power with these free credit watch.
Discover offers FICO credit score and key factors impacting your credit score. For instance, it says below that loan to credit ratio is too high, and this debt/credit ratio is dragging my credit score down. Yes, my discover card is carrying >50% balance, ideally you’d like to keep your revolving debt/credit limit ratio <15% for the best score possible while other factors held constant.
Citibank offers FICO score and impacting factors. Again, it says below that loan to credit ratio is too high, and this debt/credit ratio is dragging my credit score down. Yes, my citi card is carrying >50% revolving debt balance because it is 0% APR for 18 months. Another factor is pointed out here, low (average) length of time accounts established, which indicates to lender that I’m freshly seeking new credit lines rather than just sticking with what I had. Of course I’m seeking new credit cards periodically; I like taking advantage of sequential 0% APR and opening bonus (usually at much higher % cash back than after promotional period right after account opening.)
Last & Best, my favorite free credit score package:
Capitol One’s Credit Wise
Credit Wise even provides a credit score simulator. You can play with changing various factors about your credit activity and see how your credit score improve or worsen. Perfect way to analyze/foresee the impact of a financial decision/move. These are like free financial consultation & shed light on how one can Ace their credit score before big item purchases (mortgage, student loan refinancing, etc.).
You can see indeed I have lots of credit cards with $0 balances, this is what I meant when I mention before that I like keeping old credit cards (I don’t use, and just file away) open to keep the denominator of my debt/credit limit ratio a high number. My phenomenally high (relative to my 60k pgy3 income) denominator of DTC provides a nice cushion for taking on interest free credit card debt revolving balances without much hit to my credit score. For example, carrying 20k debt balance on 25k credit limit hurts one’s credit score tremendously. However, carrying 20k debt on 250k total credit limit is “piece of cake” in the eyes of lender, you are still VERY trust worthy borrower with a high credit score to quantify it 🙂
Here’s the toy I Credit Wise provides. This feature along, makes it worth it to open a Capitol one credit card, not to mention its 1.5% cash reward policy on Everything purchased.
Sign up, log in and start planning to Ace your credit score (you want to aim for >760 on your middle score of your 3 scores from the 3 different credit reporting agencies to get the best interest rates on financing such as mortgage.)
For example, the action I selected was “cancel/close my oldest credit card.” I hit simulate. Wahla, comes the predicted impact on my credit score from this action. It’s hit if I close my oldest account, which makes sense because lenders see the longer credit history as indicating higher credit-worthiness.
- How do you monitor your credit score/activity?
- How frequently?
- Which credit company’s credit reporting/monitoring package is the best?
Share your questions & insights below!