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Credit Report Review
What Can Credit Report Services Provide?
The top performers in our review are Identity Guard, the Gold Award winner; IdentityForce, the Silver Award winner; and PrivacyGuard, the Bronze Award winner. Here’s more on choosing a service to meet your needs, along with detail on how we arrived at our ranking of 10 services.
Your credit score is the key to such various things as owning a home, starting a business, getting a lower auto insurance premium and even being hired in some places. Sometimes, a negative credit report is a result of some bad financial luck. Other times it is because of identity theft. Keeping track of your credit score is important to heading off potential threats or correcting inaccuracies quickly if any appear.
A common misconception is that conducting a credit check or regularly monitoring your credit report and score will hurt your credit. This is not true. When you check your credit score or report, the credit bureaus consider it a "soft" inquiry that will not harm your credit score. However, if a lender looks at your credit score or credit report, usually because you are seeking credit, this is a considered a "hard" inquiry and will be reflected in your credit score.
You are legally entitled to receive one free credit report each year from each of the three credit reporting agencies, Equifax, TransUnion and Experian. You can also request a free report if someone has pulled your report, per your request, and denied you a loan or services based on your report. Credit report services are a one-stop point where you can request all three credit reports at one time instead of having to log into each individual agency and request each report. Credit reports also provide additional services to help ensure your credit remains accurate and secure.
What Can I Do When I’m the Victim of a Hack?
Equifax in July 2017 and Yahoo in 2014 are some of the most recent examples of large-scale hacks that make personal information available to criminals. These can leave you vulnerable to identity fraud, including stolen credit cards and new loans being taken out in your name.
Often you’ll be offered free credit monitoring if your information is exposed in one of these hacks. These services can be useful, but they are limited and can take up to 60 days to notify you if there’s potentially fraudulent activity on your account. They can’t usually alert you if a thief uses your information to forge a driver’s license or passport and don’t monitor retirement or brokerage accounts. Some stronger services we reviewed are more comprehensive than what you’d receive in the event of something like the Equifax hack.
One step you can take is asking Equifax, Experian and TransUnion for a credit freeze. This prevents creditors from pulling your credit file without your consent. To do this you’ll have to notify each of the credit bureaus that you want a freeze on your credit file. Usually you can do this online, but in some cases you may need to call. Once you’ve requested a freeze, you’ll get a PIN you’ll use to unfreeze your file for when you apply for a line credit. Depending on the state you live in, you might need to pay a fee to place a freeze. The fee ranges from $0 to $15.
You can also put a fraud alert on your file. The alert lasts for 90 days but can be renewed indefinitely. This requires creditors to contact you for permission to open a new line of credit in your name.
Why a Good Score Matters
Having a healthy credit score is important to your overall financial health. A good credit score, usually at a minimum of 650, is important if you need a mortgage or need a credit card. Lenders use the mean score of all three bureau reports in order to determine your average score and your loan eligibility. However, several banks tend to favor the score and reports from Experian for determining whether you are to open an account with them or receive financing through them.
Your credit score can be determined a variety of ways depending on your lender. The most universally accepted is the FICO score, which is also the model used by the three reporting bureaus. Some credit reporting services use a different model when calculating your credit rating. While they can give you a good indication about your overall credit, it may not be as accurate as what your potential lender will use. MyFICO uses the standard scoring model.
Credit Repair & Identity Theft
If you find that you do have some issues on your credit, there are credit repair services available that will help you find ways to correct errors and work with you to bring up your FICO score. However, you have to be careful since there are several scams that look legitimate but are actually out to hurt your credit or steal your identity. The credit repair services we reviewed are licensed. Credit counseling services are also a good alternative, though typically you will have to do most of the work yourself rather than paying someone to do it all for you.
Most of the services we reviewed have identity theft monitoring. This means you will be quickly alerted if anything suspicious happens, such as excessive credit applications, foreign purchases with your credit card or if any security breaches occur. However, not many of them offer help in restoring your identity. We do have a list of thoroughly reviewed identity theft monitoring services that will take more steps beyond monitoring to help stop identity theft and quickly help you get back on track if your personal information is stolen.
While credit reporting is typically for consumers, there are business credit reporting services that we reviewed that are designed to help monitor and alert you of issues with your business credit score. This is important is you are trying to secure a business loan to grow your small business. It is also important to note that, as an employer, if you check credit scores of potential employees, you should use a specific background check service that is regulated and legal. Our sister site, Business News Daily, has a great article on background check services for employers to help point you in the right direction.
What We Looked For; What We Found
While reviewing credit reporting services, we looked at the amount of services offered beyond the initial free credit report that all provide. The best credit-monitoring companies monitor your credit and notify you when something new has been posted, both good and bad. Some services monitor one or two of the reporting agencies, but our top three picks, along with Privacy Matters, provide alerts for all three. Usually reports are updated monthly, but some services, such as CreditReport.com, will update you with daily reports if the information is available.
One service we felt was important to look for is dispute assistance. This means that when something fraudulent appears on your credit report, the credit reporting service will step in and help you fight the reporting agencies to have it removed and your credit score returned. Most of the services offer one-on-one dispute assistance as part of your monthly subscription fee, though our lowest ranking services require an extra cost of this option. It is also important to note that this service is informational only. You are provided with the steps and forms needed, but you have to do all the work and follow through in order for the dispute to be sent.
Identity theft insurance covers loss that occurs while your credit is being monitored for fraud or identity theft issues, or to help recover and rebuild your credit Our top three picks, Identity Guard, IdentityForce and PrivacyGuard, received high marks for offering identify theft insurance coverage for up to $1 million. TrueCredit also insures you for $1 million against identity theft, but the other services on our review only insure between $25,000 and $50,000.
Our Verdict & Recommendations
We feel confident in the credit-monitoring abilities of the services on our lineup, though we're most impressed with our top-ranked products. Identity Guard, IdentityForce and PrivacyGuard are our top picks for credit report services because of their level of fraud and incident monitoring and the $1 million in identity theft insurance offered in addition to the basic reports and FICO scores that each of the services on our review provide. These are some of the only programs that provide frequent updates to all three credit agencies, while most others only provide this for one or two.