Featured Experts
Joanne
Joanne S. Liu Former Attorney & Financial Writer View bio
Lita
Lita Epstein Author, The Complete Idiot’s Guide to Improving Your Credit Score View bio
Beverly Harzog
Beverly Harzog Nationally-Recognized Credit Card Expert View bio
Jerry Battle
Jerry Battle Attorney, NCLC View bio
Andrew
Andrew Sperling Director of Federal Legislative Advocacy, National Alliance on Mental Illness View bio

This guide was written by

Chris Woolston

Who Cares About My Credit Score?

Your landlord

Most landlords care a great deal about your credit score. They view your score as a reflection of how responsible you about paying your bills on time. Finding a tenant that will make rent payments on time is a top priority for many landlords. Landlords may have a minimum credit score that they require before considering an application further. Once you pass the minimum score criteria, landlords may look further into your credit report to determine if you are a suitable tenant for their rental property.

Your mortgage lender

Mortgage lenders have an even greater interest in your credit score. While landlords can evict a tenant for non-payment of rent, foreclosing on a home is a much costlier and lengthier process. Lenders will zero in on your credit score, along with other factors, to determine whether or not to approve you for a mortgage. They’ll also use it to determine your interest rate. If your credit score is too low, they’ll charge you a higher interest rate to make up for the increased risk.

Your car dealer

If you’re paying cash or using outside financing, car dealers won’t care one bit about your credit score. However, if you finance your car through their dealership, checking your score becomes one of their top priorities. But they won’t necessarily look at your overall credit history; the dealer wants to know if you’re likely to make your car payments on time, not the balance on your credit cards or your mortgage. For that reason, most car dealerships will use an auto industry-specific credit score to determine whether give you a car loan and what interest rate you’ll pay.

Your employer

Your employer shouldn’t care about your credit score, but some do. Federal law allows employers to pull your credit report when hiring if they get your advance permission, but at least 10 states have barred employers from doing so — or put restrictions on the practice. If you live in one of the states that bans the use of credit scores in hiring, you’re protected. Otherwise, you have a choice to say no and risk getting shown the door, or explain any dings to your credit in advance and remain in the running. If you do have to produce a credit report, the one your prospective future employers see is specially formatted to leave out certain information. The data they can’t see includes your date of birth, so they can’t illegally discriminate against you when it comes to protected information such as age.

The Best Ways to Get a Credit Score

There are lots of ways to check your credit score. One way is to directly contact one of the three consumer credit reporting agencies: Equifax, TransUnion and Experian. We’ve identified the best of your other options, keeping both value and quality in mind.

Best for Your Three Official FICO Scores in One Place: MyFICO.com

MyFICO.com allows you to purchase your official FICO credit scores from all three credit reporting agencies, along with your credit reports, for $29.95 per month.

Best for Free Daily Credit Score Updates: WalletHub.com

If you sign up at their website, WalletHub.com offers free daily updates for both your credit score and credit report based on information from TransUnion.

Best for a Free Monthly Experian FICO Score: Discover Credit Scorecard

Whether you’re a Discover customer or not, you can sign up for a free monthly Experian FICO credit score in just a few steps. Discover even shows you what is helping and hurting your score.

Best for a Free Monthly Equifax FICO Score: Citi Credit Card Holders

If you have a Citi credit card, you have access to free monthly FICO credit score updates based on your Equifax credit information. Citi tracks your credit score history over the last six months in a graphical format so you can see how your score is trending.

Best for Free Weekly Credit Scores from Two Agencies: CreditKarma.com

CreditKarma.com offers free weekly credit score updates from both TransUnion and Equifax. CreditKarma.com also allows you to see your credit reports from those agencies for free.

We have more details about ways to get your credit score for free on our Free Credit Score page.

Credit Score, Credit Report, Credit History:
What’s the Difference?

A credit score is a 3-digit number that represents your credit worthiness. Your credit score is calculated based on information in your credit report. The most widely recognized credit scoring formula is FICO, whose scores range from 300 to 850, with 720+ considered very good. (To get the best interest rate for some mortgages and refinances, however, the Home Buying Institute reports you should have a credit score of 750.)

A credit report is a file of information held by each of three credit reporting bureaus — Equifax, TransUnion and Experian — that compiles your credit history in one place. The bureau uses the information in the report to calculate your credit score, which is usually similar but not identical to the score that lenders see.

Your credit history is information about your past dealings with credit and debt, including how much debt you have, your monthly payments and whether you make your payments on time.

Your Credit History Questions Answered

Your credit history is being tracked whether you know it or not, so you might as well educate yourself about what exactly your credit history is and how it can affect you.

What items are included in my official credit history?

Your credit history can include any of the following items:

  • Payment history for:
    • Credit cards
    • Car loans
    • Personal loans
    • Mortgages
    • RV loans
  • Amounts owed on debts
  • How close you are to your credit limits on your credit accounts
  • Judgments against you
  • Liens against you
  • Bankruptcies
  • Foreclosures
  • Inquiries for credit information

What happens if I miss a payment?

Missing a payment can have a large impact on your credit score—after all, your payment history accounts for 35 percent of the credit scoring calculation. Normally, late payments are reported to the credit reporting agencies after a payment is over 30 days past due. If you aren’t yet 30 days past due, make the payment before the deadline and you will avoid a ding on your credit history. (Remember that payments on Sunday will generally be counted on the next business day, and if your payment is to a bank on the East Coast and you live on the West Coast, so you may need to pay by 2:00 p.m.) After 30 days, the longer you are past due on a payment, the further your score will drop. Payments that are 90 days late or more can harm your credit score for up to 7 years. One payment that’s just over 30 days late will ding your credit, you should be able to rebuild it in the next year or two.

What are other things that could ding my score?

  • “Hard inquiries”, or credit checks that occur when you apply for a loan or other form of credit. (“Soft inquires,” such as those for background checks, don’t affect your score).

  • A debt going to collections

  • Changes in your credit limits

  • Changes in the amount of debt you owe in relation to your credit limits

  • Bankruptcy

  • Foreclosure

  • Changes in the length of your credit history

  • Changes in your mix of credit, such as car loans, student loans, mortgages and revolving credit

How can I quickly improve my credit score?

It usually takes time to improve your score, but one of the best things you can do is to pay down your credit cards. After all, your debt-to-credit ratio translates to about 30 percent of your credit score. Paying off your cards completely is the best, but getting them all paid down below 20 percent or even 50 percent could greatly improve your score. Since each maxed-out card may drag your score down by 10 to 45 points, paying off a couple of cards might add nearly 100 points to your score. Don’t close your cards, though, or your debt-to-credit ratio may change again and cause your score to drop.

Will having a student loan harm my credit?

Having student loans shouldn’t hurt your credit. In fact, student loans provide you with a great opportunity to build excellent credit. To avoid damaging your credit while you have student loans, don’t overextend yourself with other forms of credit. Missing payments on your credit card in order to keep up with your student loans is no way to build a winning score.

Can a lender discriminate against me because of previously bad credit history?

Yes, lenders can refuse to offer you credit or demand a higher interest rate due to your bad credit history. In fact, your credit score is one of the most important factors lenders use to make loan decisions. However, lenders cannot discriminate against you based on age, race, national origin, religion, sex, marital status or receipt of income from public assistance programs thanks to the Equal Credit Opportunity Act.

Updated: July 27, 2017