Is there any value in knowing your credit score for free?

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Hello MFC-Robert
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Is there any value in knowing your credit score for free?

Postby Hello MFC-Robert » Sun Jan 18, 2015 4:02 pm

For January, financial commentators encourage people to take stock their financial goals at the start of the new year, including improving our credit scores. Thanks to the 2003 amendment of the Fair Credit Reporting Act, each American consumer with a credit history can get a free credit report once per 12-month period from credit reporting agencies Equifax, Experian and Trans Union. Simply visit, call 1-877-322-8228, or print and complete the credit report request form, then mail it to: Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. I recommend U.S. Priority Mail, to track when you can expect your credit reports by mail or when to follow up if not received.

Other credit reporting agencies also must provide any consumer who requests their free credit report every 12-months, but those credit reporting agencies must be contacted separately. Consumers may also be able to get their credit reports for free, under certain circumstances, more than once every 12 months or they can purchase their credit report for $10.50 or less, the maximum amount set by the FTC, which a credit reporting agency may charge. The FTC warns everyone to be especially cautious about imposter websites and spam emails that solicit personal information.

Because a credit report can be many pages, containing hundreds or even thousands of pieces of information about the consumer, different companies developed credit scores to assist creditors with assessing risk, by computing a single number from the consumer’s credit history. Also, different companies have developed credit scores for each industry type and for each credit reporting agency. For example, the risk assessment of a consumer is considered different between a mortgage, a car loan, and a credit card. Also, the credit score is different depending on whether the report is based on Equifax, Experian or Trans Union. Thus, a credit score has been developed for each industry to help that industry assess the risk of extending their specific form of credit for each credit report.

Unfortunately, U.S. federal law currently does not give consumers the right to order their credit scores for free nor is there a standardized or regulated formula for computing credit scores. This fact, however, has not stopped financial bloggers and writers from encouraging readers to order their credit scores. Recently, large banks, such as Discover and Capital One, have been promoting certain credit cards by offering customers access to free credit scores. Discover’s website ( ... score.html) states: “Discover provides FICO® Credit Scores based on information from your TransUnion credit report.” Capital One’s website ( ... t-tracker/) states: “Your Credit Tracker score is calculated based on the TransUnion New Account Model.”

A free credit score from Discover or Capital One is probably not the same credit scoring model that a future creditor would used in considering an credit application of a mortgage, car loan or credit card. Even if the score is a “FICO Score” (which is a formula by the Fair Isaac Corporation), FICO is now in version number nine (FICO 9), but many companies still use older versions of FICO. Thus, unless the consumer knows their FICO score for each industry type, how will he or she know if the score will be the same when applying for car financing, a home mortgage or a credit card?

Thus, checking your personal credit report to ensure it is accurate and complete is more important than getting a credit score, which is probably computed from a different credit scoring model.
Robert Stempler, Attorney at Law
California State Bar # 160299
Telephone: (805) 246-2300
_ © 2015 Consumer Law Office of Robert Stempler, APC

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