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What You Need to Know About 'Free' Credit Scores

Lance Cothern

Checking your credit score is one of many important tasks to keep an eye on your financial health. While you can pay for access to your credit score, you can save money by using one of many companies that offers score access for free.

Banks and personal finance websites may give you access to your credit score on a daily, weekly or monthly basis, but not all credit scores are created equal. No-cost credit scores offer a good way to check the pulse on your credit, but you have to take them with a grain of salt, says Carla Blair-Gamblian, personal finance educator at Veterans United Home Loans.

Free credit scores can come with catches. Even though the credit scores offered are real, they may not be the same scores lenders use to make lending decisions. Additionally, some companies may use your credit information to advertise relevant products or services. If you're thinking about using a complimentary credit score to monitor your financial health, consider the following before signing up.

Not All Credit Scores Are the Same

Which credit score you receive varies depending on which website or company you use. Each company may use a different credit scoring model or credit bureau to generate your credit score. "There are many types of credit scores and even many types of FICO scores," says James Garvey, CEO and co-founder of Self Lender, which offers credit-builder loans.

While there are two major credit scoring models (FICO and VantageScore), each model has several variations that can produce different scores.

For example, you might get access to VantageScore, while a lender uses FICO. You could see a score that indicates you have good credit, but the lender sees fair credit on a different model. That can make a difference in getting approved or qualifying for the best interest rates.

Some free credit scores are only from one of the three major credit bureaus: Equifax, Experian or TransUnion. But as lenders typically base lending decisions on scores from all three bureaus, you need to view all of them to have a full picture of your credit.

"Traditionally, you're going to need all three bureaus pulled for mortgage lending," says Blair-Gamblian.

[Read: Best Rewards Credit Cards.]

Each credit bureau is independent, says Garvey. While they strive to have as much information as possible about your credit history, lenders don't always report credit information to all three. A bureau won't have a record of a particular line of credit if it wasn't reported to the bureau.

"There may be some small bank that may only report to one bureau, and there may be something that goes wrong with that account," says Blair-Gamblian. If you're only monitoring your Experian credit score and an account with a reporting error is only reported to TransUnion, you may be surprised to see a lower score generated by TransUnion information.

Most no-cost credit scoring services are transparent about which credit score you're receiving. The scoring model is usually listed with the credit score. However, customer support should be able to provide you with the information if you can't find it elsewhere.

You could try to cobble together complimentary credit scores from multiple websites to end up with a credit score from each bureau. But you would still need to make sure all three credit scores use the same credit scoring model so you can make an apples-to-apples comparison. For example, if your lender uses a FICO Score from all three bureaus, you'll want to access those scores rather than a VantageScore.

Although free credit scores have their limitations, they are helpful as an educational tool and general guide for how you're doing with credit. You don't need to obsess over getting the exact same score as your lender unless you have a borderline score.

You Can Still Buy Credit Score Access

If a particular credit score is critical for approval or qualifying for the best rate on a product, you may want more than a free score can offer. When accuracy matters, find out which scores the lender uses and make sure you're viewing the same ones -- which might require paying to access your score.

With myFICO, you can purchase multiple FICO Score versions at one time through its FICO Score 3B Report and FICO Score 1B Report. The FICO Score 3B Report shows your 28 FICO Scores from the three bureaus most widely used in mortgage, auto and credit card lending. The FICO Score 1B Report shows 10 FICO Scores from a single bureau.

You can also buy VantageScore 3.0 model scores from Experian and TransUnion, as well as your Equifax Credit Score model score from Equifax.

[Read: Cash Back Credit Cards.]

Where You Can Get No-Cost Credit Scores

There's no shortage of access to free credit scores. "A lot of people have credit monitoring sites with their banking institutions," says Blair-Gamblian. Some credit unions and banks offer a free credit score as long as you have an account or qualifying product such as a credit card or loan. Some even offer complimentary credit scores to those who aren't customers. Personal finance or credit monitoring websites may offer credit score access, too.

VantageScore lists the lenders and websites that offer a free version of its credit score, including the version offered. Among the banks where you can find free VantageScores are Capital One, Chase, OneMain Financial and U.S. Bank.

You can also get free FICO credit scores from many lending institutions. Some notable free FICO score providers include:

-- Bank of America

-- Barclays

-- Citibank

-- Discover

-- Navy Federal Credit Union

-- PenFed Credit Union

-- Wells Fargo

What's the Catch?

Though you can access your credit score for free, it's not free for lenders to obtain your score. For complimentary credit scores to be profitable, they need to provide a benefit to the company offering them. Typically, that means advertising.

If you're not already a customer of a bank offering free credit scores, it hopes a complimentary credit score may influence you to become one. Even if you are already a customer, banks hope to keep you or may suggest you use other products the bank offers.

Personal finance websites typically use your credit information to advertise financial products. Having access to your credit information makes the experience better for the consumers, says Garvey. Since the websites know your credit profile, they can show you offers within your financial reach.

These websites may earn money when you view, click, apply or get approved for one of the offers you're shown. Some products may be more profitable than others, which could influence the offers with the most prominent advertising. You should always independently research products to make sure you're getting the best deal possible before accepting an offer, as other options might be a better fit.

[Read: Travel Rewards Credit Cards.]

Don't Forget to Check Your Credit Report

Even if you're armed with multiple credit scores, numbers alone don't offer the full picture.

Your credit scores are numerical representations of your credit risk based on the information in your credit reports. If your credit reports contain incorrect information, your credit scores won't be accurate, either. That's why it is so important to still check your credit reports on a regular basis.

You can check your credit report for free once per year per bureau as mandated by federal law by visiting AnnualCreditReport.com. Some free credit score providers also provide free credit reports. Unlike credit scores, there is only one version of your credit report from each bureau, so you don't need to worry about checking many versions per bureau.

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