So, does your annual credit report include a FICO score? Answer? No, but you get all the information that is used to generate your FICO score.
What Is a FICO Score?
FICO, a product of the Fair Issac Corporation, is the credit score that 90% of lenders use to make credit decisions. There are three credit bureaus that report FICO scores: Transunion, Experian and Equifax. You will often have three different FICO scores, one with each credit bureau. The score difference can range from a few points to 100 points depending on the information the credit bureaus have. In addition to three credit bureaus with different scores, there are 19 different FICO scoring models commonly used by lenders.
Your FICO score is based on five categories. The categories are not given equal weight in calculating the score. The categories and weights are:
35% – Payment History
30% – Amounts Owed
15% – Length of Credit History
10% – New Credit
10% – Types of Credit in Use
What Is an Annual Credit Report?
The annual credit report is mandated by the government. Every consumer is entitled to one free copy of their credit report per year that shows all the information in their credit report. The annual credit report does not provide a credit score, but it does provide the information that is used to calculate your FICO scores.
FICO Score vs Annual Credit Report
Number of Reports
There are many companies that offer your credit score, but myFICO.com is the only company that provides the actual credit score that lenders see. myFICO.com provides scores from all three credit bureaus and the most commonly used 19 FICO scoring versions.
Annualcreditreport.com provides one copy of the your credit report from each of the three credit bureaus.
A subscription to myFiCO.com provides credit reports and score updates every quarter.
The annual credit report provides a copy of your credit report once per year. There are exceptions where you can receive more than one copy of your credit report. For example, if you are denied a loan based on your credit score, you can receive a copy of your credit report.
A subscription to myFICO.com costs $29.95 per month. There are other companies that offer access to your credit scores for a lower monthly fee, but they do not provide all 19 versions of your score and may not be the true FICO score. Credit Karma offers a free credit score, but it is not the FICO score. So, pretty much if you want your FICO score, you will have to pay for it. Sometimes however if you are applying for a mortgage or car loan, the lender might choose to share the FICO score with you for free during the application processes.
The annual credit report is free.
Is FICO Better Than Annual Credit Report?
It depends on why you are checking your credit. If you want to make sure that there are no errors, the free annual credit report is a better option because you can see all the information on your credit report at no cost. The FICO score is better if you are planning on making a major purchase, such as buying a home, and want to know your credit score before applying for a loan.
Regardless, it makes good sense to utilize the free annual credit report – after all, it never hurts to keep an eye on your credit!