Over the last decade, it’s gotten immeasurably easier to access your credit report and credit score. Not only can you get a free copy of your credit report each year from the three major credit bureaus through AnnualCreditReport.com, it’s also easier than ever to learn that all-important, three-digit distillation of your credit health: your FICO credit score.
Many credit cards now offer your free FICO score on your monthly statement just for being a cardholder. While some of these card issuers only make your score available on your monthly statement, others let you access it any time you sign in to manage your account online. To learn which cards offer this perk – and why it’s important to begin with — keep reading.
Your FICO Score: Why It Matters
Before you sign up for a credit card that offers your FICO score for free, you should understand why this number is so important. Just like nearly another component of your financial health, your credit score carries several important roles. For starters, your FICO score is a three-digit manifestation of your credit health – and the one thing lenders look at most when deciding whether to grant you credit.
Where having an excellent credit record and high credit score is an asset, a low score and poor credit history could throw a monkey wrench into any plans you have to borrow money. And since a low FICO score tells lenders that you’re a risky borrower, you may be faced with higher interest rates even if you are able to get the loan you need.
If you ever want to buy a house, finance a car, or borrow cash to start a business, your credit – and your FICO score – are of utmost importance. Your next job may even depend on it. And that’s one of the main reasons it’s so important to track your score closely.
What’s more, not all credit scores are created equal. While some websites can provide you with a free credit score or estimate, it’s usually not your FICO score — the one most lenders check when you apply for a loan or credit card.
Credit Karma, for example, offers users free access to their TransUnion and Equifax credit scores calculated based on their credit report data. However, neither score uses the exact proprietary FICO algorithm — which means that, while those estimates can be very useful, they can be quite different from the score your mortgage lender pulls.
When it comes to your FICO score, what you don’t know can hurt you. The best way to figure out where you stand – and to monitor your progress – is to keep a close eye on your score at least once per month. By doing so, you can watch your progress and celebrate “small wins” as your score improves over time.
Tracking your FICO score also means you’ll be able to spot any shenanigans and see when credit card fraud – or even identity theft – could be putting your credit at risk. When you keep a close eye on your score month after month, you always know where you stand.
Credit Cards That Offer Your FICO Score for Free
As of late 2016, the following cards offer users a free FICO score on their monthly statement:
American Express offers a recent estimate of your FICO score that’s easily accessible online. Popular AmEx cards include the Blue Cash Preferred® Card from American Express and the Starwood Preferred Guest® Credit Card from American Express (currently unavailable).
Bank of America started offering FICO scores to customers who carry its consumer credit cards in 2015.
Barclays US offers up a TransUnion FICO score through its online account management. Check out the Barclaycard Arrival™ World MasterCard® (offer expired), a travel reward card with no annual fee, to get this perk.
Capital One offers cardholders an estimated FICO score as part of their Credit Tracker service, which also includes a summary of your credit reports. Popular cards from Capital One include the Capital One® Quicksilver® Card – 0% Intro APR for 15 Months cash-back card and the Capital One® VentureOne℠ Rewards Credit Cardtravel rewards card.
Chase began offering a free FICO score to those who carry the Chase Slate® (currently unavailable) credit card in 2015.
Citi began offering up users’ Equifax FICO scores through its online account management in early 2015. (See how one blogger used rewards from his Citi ThankYou Premier card to pay off student loans.)
Discover offers cardholders a FICO score on each monthly billing statement and online. Some popular cards include the no-annual-fee Discover it® Cash Back card and the Discover it® Miles, while college students can track their budding credit profile with the Discover it® Student Cash Back card.
U.S. Bank offers consumer’s TransUnion credit scores and corresponding credit reports through its online account management tools.
How Your FICO Score Is Determined
In our post on how to build credit, we explain the detailed process behind how your FICO score is calculated. To sum it up, FICO weighs the following moving parts to come up with a comprehensive score:
- Payment history (35% of your score)
- Amounts owed (30%)
- Length of credit history (15%)
- New credit (10%)
- Types of credit (10%)
As you can see, the biggest factors making up your FICO score are your payment history – as in, whether you’ve paid your bills on time – and the amount of money you owe in relation to your credit limit. The latter part, “amounts owed,” can also be referred to as your credit utilization.
The length of your credit history also plays a part, with a longer history of prompt payments and responsible credit use working in your favor. New credit lines and applications and the types of credit you have also play a small role: A variety of loan types, from student loans to credit cards, and a limited amount of new credit both help your FICO score.
- Related: What’s a Good Credit Score?
Whether you want to build better credit, keep an eye on your existing credit profile, or simply make sure your score doesn’t dip over time, keeping a close eye on your FICO score is always a good idea. Fortunately, a slew of rewards credit cards, balance transfer cards, and cash back cards now offer this perk to cardholders for free — all you need to do is sign up.
Do you keep track of your FICO score? If so, how do you keep an eye on it?
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