Experian is a credit reporting company that can help you access your credit reports and credit scores to prove your creditworthiness to a lender. If you don’t want to sign up for Experian CreditWorks, which allows you to keep track and monitor your credit history for free, you can use a one-time Experian credit report to access your FICO scores instead.
Credit Report and Credit Score Basics
You will need a good credit score if you are making a large purchase that requires taking out a loan such as an auto loan or a mortgage. Many lenders use the FICO credit scoring model to determine whether you get approved for a loan. How does this model work, and how can you improve your score?
A credit report contains things like records of monthly payments, any debt you’ve accrued, collections, and bankruptcies. Lenders want to be assured that they are loaning money to someone who is financially responsible. If your credit history is full of late or unpaid bills, lenders will think twice about giving you money.
Some lenders won’t work with you if you don’t have a credit report. This isn’t always your fault: you only get a credit report when a creditor sends your information to a credit bureau. Credit reports are also eventually deleted after long periods of inactivity.
A credit score is a number, usually between 300 and 850, determined from the data on your credit report. Anything below 580 is considered poor, with 670 considered the baseline for a good score. However, many lenders will still approve loans within the 580-669 range.
The good news is that your current credit score isn’t set in stone. As you repay debt and pay bills on time, your credit score will gradually improve. However, most people don’t know their actual credit score even though checking your score does not cause it to decline.
Checking your score yourself is known as a soft inquiry, which doesn’t affect your score. Lenders use a hard inquiry to look at your credit, but it only decreases your score by a few points. All hard inquiries fall off after two years.
Credit Scoring Models
The traditional credit scoring model was first created by an engineer named Bill Fair in 1956. However, the first credit scoring model had a much more subjective slant. Today, credit scoring companies create credit scoring models based on hard numbers rather than an individual’s gender or marital status. Federal laws like the Equal Credit Opportunity Act keep these standards in place.
Credit scores and credit reports remain a popular method of determining creditworthiness because of efficiency. Having all of a borrower’s credit history in one convenient document allows lenders to process many applications quickly. The promise of more opportunities with a good score also encourages people to make better financial decisions. Credit scores are used by auto loan lenders, credit card companies, personal loan companies, and even some government websites.
Your credit score is represented by a three-digit number that rates your creditworthiness. These are the FICO credit scoring ranges:
- 300-579: Very poor credit score
- 580-669: Fair credit score
- 670-739: Good credit score
- 740-799: Very good credit score
- 800+: Exceptional credit score
FICO scores are calculated based on:
- Payment history
- Amounts owed
- Length of credit history
- Credit types
- New credit
Payment history is the most significant factor when determining your score. The types of credit show how you’re managing different types of credit, such as credit cards and loans.
Credit usage is another important factor: how much of your available credit is currently in use, also called your credit utilization rate. Experts recommend keeping your utilization rate to below 30%. Total credit balances (or outstanding debt) carry slightly less weight than your utilization rate, but it’s an area you should target for improvement.
Some lenders consider the FICO score more reliable because it’s the oldest model still in use today. It was created in 1989 and has received several upgrades over the years to ensure its data is as accurate as possible, and it is still the most popular creditworthiness standard.
FICO Score 8 is currently the most popular version of the model used by lenders. This update made it easier for borrowers with little data on their credit reports to secure a loan. It was also more forgiving to individuals with occasional late payments and it ignores collections accounts of less than $100. Timely payments and low credit card balances significantly increase your FICO score.
The only downside about this update is that it has more penalties for borrowers with unpaid medical bills. This was fixed in 2016 with the release of FICO Score 9.
To summarize, this is what you need to remember about your credit score:
- Ideal Credit Score: 670-800+
- Minimum Credit Score for Loan Approval: 580-669
- Biggest Weight on Score: Payment History
Experian One-Time Credit Report
Experian uses the FICO Score 8 model to determine your credit score. If you’re borrowing a loan soon, it’s a good idea to check your credit report and credit score beforehand. Rather than potentially getting rejected on a loan application, you can make changes to improve your score ahead of time.
The Experian Credit Report also conveniently highlights the factors that are both hurting and helping your credit score. For extra security, Experian also requires identity documentation before it releases any sensitive credit information. If you notice any mistakes on the report, Experian allows you to file disputes at no cost.
Is Experian Credit Report Accurate?
As long as the information reported by creditors is correct, you can trust Experian’s credit report. Customers can also get peace of mind from the reliability of the FICO 8 credit scoring model. You can still dispute inaccuracies on your report, which are usually resolved between 30 and 45 days.
You can’t remove poor credit from your Experian Credit Report if all your information is found to be accurate. However, since Experian alerts you to the factors that need improvement, you can start working towards better credit right away.
How To Get An Experian One-Time Credit Report and Credit Score
You can access a one-time Experian credit report and FICO Score for $19.99 to prove creditworthiness to a lender by visiting the Experian website.
Additionally, Experian also offers a 3-Bureau Credit Report and FICO Scores option. This provides you with credit information from Equifax and TransUnion, two other popular bureaus. Having access to all three of these scores will give you the most accurate picture of your overall creditworthiness. This service also includes live customer support each day of the week.
To summarize, here are the highlights of the one-time Experian Credit Report and Credit Score:
- It includes an Experian Credit Report and FICO Credit Score.
- It is best for prospective borrowers.
- The product delivery is instant.
- Experian offers customer support.
- An Experian Credit Report and FICO Score check cost $19.99.
- If you want the 3-Bureau Credit Report and FICO Scores, the price is $39.99.
Experian also offers other credit solutions like the below:
- Experian Boost: Link your bank accounts to automatically report positive payment information to improve your credit score faster.
- Experian CreditWorks: Access free credit reports and score, monitor your credit score to avoid fraud with automated alerts.
- Experian CreditMatch: Get matched with loans and credit cards based on your financial situation and credit scores.
- Experian For Business: Discover how they can help you with all your credit business affairs.