Not All “Free” Credit Reports Are Free

Don’t you hate it when free doesn’t really mean free?  Buy one get one free only helps if you need two of something.  “Free with purchase” means they’re getting you in the store and you’ll probably buy more than you need.  And then there’s “free when you open a credit card.”  Which is basically getting a $20 item in exchange for years and sometimes thousands of dollars of interest. So is there such a thing as a free credit report?

It’s true that the Fair Credit Reporting Act made it law that we have access to the information on our credit report free of charge.  But not all places that masquerade as free really are.  Here’s how you can tell the good guys from the not-so-good guys.

Best Truly Free Option – AnnualCreditReport.com

Pro’s:

  • Honest to goodness free. One copy of each report in a 12-month period.  You can get all three at once or one at a time.
  • You don’t have to be online savvy. You can call them at (877) 322-8228 or you can mail in a request.

Con’s:

  • The government regulation says that you deserve to know if there’s errors on your report. But technically you don’t need to know the score to know whether the report is accurate.  So no free score.  You can purchase it through the site if you want to.
  • Some people have issues logging back in to re-review the report pulled. Be prepared to save/download or print a copy when you log in.
  • Not always the easiest printouts to read. If you have trouble making sense of the report, places like Apprisen can help.
Don’t Use– FreeCreditReport, FreeCreditScore, etc

Pro’s:

  • These are primarily credit monitoring services that give you the first month and a credit report for free. But really, if you want a credit monitoring service, find one that sells itself as such, not one that tries to slyly get in under the “free” radar.

Con’s:

  • Can be expensive services for what they offer, and tend to prey on you not realizing it’s an ongoing monthly charge which you need to cancel if you do enroll.
  • Choosing a business name is all about selling a product.  They could call themselves WeAreAwesome.com or WeRaiseYourCreditScore1000Points.com but it doesn’t mean it’s true.
Use With Caution As a Savvy Consumer – Credit Karma, Credit Sesame, Credit.com

Pro’s:

  • These are established and funded through the credit bureaus themselves, so they’re not start-up scam companies.
  • The reports and (simulated) scores are really free.

Con’s:

  • Everybody has to make money somehow, so these sites are going to get it through advertisements and links to open credit cards. If you can’t say no, don’t peruse the site/app.
  • The credit score is not exactly the same as what your bank or credit union or mortgage lender or car loan officer are going to see. Don’t expect to flip your phone around to show them your Credit Karma 655 and expect them to base your interest rate on that.

Really it boils down to two basics: If it says “free” but asks for a debit card number, it’s got something up its sleeve.  And if they have enough money to advertise everywhere and have a catchy jingle, they’re getting more money from their business than what a free credit report can provide.

Still have questions?  Want help make sense of your report from a Financial Specialist that is caring and knowledgeable? We have a wide array of services for people at all stages in life. You can get a free financial review with a complimentary credit pull.  For a credit review and an action plan to build credit, check out our Financial Health Plan–it also includes a financial health assessment, a snap shot of wealth/net worth and more.

Additional blog resource: You Should Read Your Credit Report at Least Once a Year

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