Your credit score is so important. It generally ranges from 0-900 with 650 being the Canadian average, according to TransUnion. The higher the score, the better. If you have a high score it may indicate that you’re less likely to default on your repayments if you take out a loan – making you more attractive to lenders. But what’s the best practice when it comes to monitoring your credit score? Is a free credit score beneficial?
A free credit score check is a great first step to take when you’re new to credit and looking for a place to start. There are many websites online that will provide you with your credit score for free, which will allow you to figure out what your next steps are in order to improve your score. While free credit score software allow you to check your score, they often lack the sophistication to tell you exactly how to improve it. It’s often a guessing game when it comes to free credit score checks, and we’re left clueless searching for ways to boost our credit. So, when searching for credit score software, what features should you be looking out for? Let’s learn five features that a free credit score check generally doesn’t show you and one’s you should always have.
It doesn’t strategically tell you what debts you need to pay to benefit your score
We can all agree that credit scores are a mystery. We are often left paying off random debts, at various times of the month in the hope it will boost our score. A free credit score check generally doesn’t provide you with information on budgeting and debt management when it comes to bettering your score. It may provide you with a general way to improve your score, but it’s not unique to you.
Everyone has different goals, different budgets and different creditors and debt to pay, so no general recommendation can help a wider population. Score-Up’s Target Score & Money Simulator is completely unique to you and allows us to use your credit data to recommend what to pay, when and where, within your desired budget to reach your target score. Check it out here.
How to track your progress
Your free credit score software will tell you what your credit score is – great! Let’s say, your credit score is below 650, and you’re doing everything you can to improve it in order to obtain a mortgage, personal loan, auto loan or other financial product. A free credit score check will not monitor your credit and track your progress throughout your credit boosting journey.
A credit monitoring technology will not only help you keep track of your progress, but it makes you become more conscious of your spending habits. For example, you’re continuing to see your credit score increase due to putting your money aside regularly, it might make you think twice about splashing out on that new television or pair of sneakers. It will show you how your actions will affect your credit score, which you will be easily adapt to these habits which you can use for the rest of your financial journey.
How to analyze your credit points
A free credit score check usually involves pulling your credit report from one of the major Canadian credit reporting agencies, Equifax and TransUnion. From here, your credit score is like a quick snapshot of your credit report and is a telltale sign to lenders and creditors of how financially reliable you are.
When you need to improve your credit score, Score-Up‘s, Point Deduction Technology can help benefit you on your journey. It will tell you exactly what debt to pay and when to pay it, in order to maximize points and reduce negative impacts to your score. Using 15-years’ worth of credit data, this algorithm uses machine learning and artificial intelligence to provide you with recommendations that are updated daily, meaning the advice is always accurate and up to date.
It doesn’t allow you to set targets
Like if we’re setting a savings goal, or even in the gym, setting targets is important in all aspects of life. It’s easy to work towards saving or losing a few extra pounds when you see yourself getting close to your target. And it’s no different for your credit score. A credit score check will not give you any idea of how you should reach your target. It’s like knowing you need to lose 5 pounds for health reasons, but not knowing how exactly to get there.
When choosing a credit score software to sign-up for, look out for a target setting feature. Whether you have a target budget you can only spend, or need exactly 50 credit points, having a target score calculator that provides you with recommendations will help your progress and allow you to reach your goal faster.
It doesn’t help you track errors on your credit report
Studies show that 79% of all credit data contains errors, which could be working against you. Many credit scores are unfairly being pulled down as a result of errors on credit reports. Many Canadians may be completely unaware that their scores are lower than they really should be, simply because of errors on their credit report.
When it comes to your free credit score software, they might tell you your score, but what happens if it isn’t accurate due to errors on your report? When searching for the right credit score product, having an error and omissions tracker will provide you with peace of mind knowing your score is accurate and true.
For Score-Up, it has the capability to find these errors and omissions on your credit report and tell you the next steps on how to get them changed or removed from your credit report. Do you know what that means? Free credit points back on your credit score. Check out how it works here.
Marble Financial (CSE: MRBL; OTCQB: MRBLF). We are a group of forward-thinking financial technology experts that understand Canadian’s occasionally need help in achieving longer-term credit health. Through our industry-leading proprietary technology solutions Fast Track Loan, Score Up, and Credit Meds, we guide our customers back to mainstream credit 50% quicker than traditional methods. Since 2016, We are proud to have empowered thousands of Canadians to a positive financial future and continue to establish ourselves as a leader in financial wellness.