Paid vs. Free Credit Score Monitoring – Part II

In our last blog we explored the features of a service called Credit Karma that offers users free access to their credit scores. Now we’ll look at a fee-based service that offers similar benefits, and try to determine if it’s worth the money.

Part II — Paid

MyFICO

MyFICO.com offers a lot of the same features as Credit Karma does, for a fee. You get credit score tracking, reports and a big community – just like you do with Credit Karma. So why pay the fees? We’ll cut to the chase and tell you the two big things MyFICO offers that makes it a bit more valuable than any free service:

FICO 8: Without a doubt, FICO 8 (and soon, the new FICO 9) is THE definitive score in use throughout the USA today. The FICO Score has become the default option for a wide range of credit issuers – from credit card issuers to home lenders to auto lenders. The other scores available give you a good sense of how you’re doing with credit-worthiness, but in many cases FICO is the last word.

Data from All Three Bureaus: By signing up for MyFICO (and paying their fees) you can track information maintained on you by all three of the Big Three consumer credit bureaus, not just the one or two you can access via free services like Credit Karma.

There’s no doubt this level of comprehensiveness makes MyFICO a more potent resource than Credit Karma. But, as we said, it comes at a cost.

MyFICO offers three levels of service. The most basic of these costs $14.95/Month or $149.95/Year for 1 Bureau (Equifax) plus FICO 8. The most advanced level costs $29.95 or $329.95/Yr for All 3 Bureau Reports Plus FICO Scores plus ID Theft Monitoring. You can cancel at any time without penalty.

Is it worth the money?

Yes, for some people it is. If you are getting close to a big purchase (house, car), you will want to have the most information possible about your credit-worthiness. MyFICO’s top-tier service gives you that. It gives you an authoritative, and updated, look at your credit reports, and the scores that will most likely determine whether you are approved or denied the loans you seek.

Using that top-level MyFICO service would be excellent insurance against being hit with “gotchas” when you apply for big loans. The ID theft monitoring service that comes bundled in with that tier of service is a powerful tool as well.

Since you can cancel without penalty, we’d advise that you use these paid services when you really need them – such as when you’re getting near to buying a house or starting a new business. You don’t have to be locked into a full year of paying for the service, after all.

For most other people, the free services offered by sites like Credit Karma will give them most of the information they need to track their credit profile. And here’s another wrinkle: FICO is now partnering with financial institutions through the Free FICO Score program. This means that FICO scoring information is now being offered free of charge by many credit issuers.

Does this diminish the value of the paid FICO service? We think it may do just that, up to a point. It is still worth something to have ongoing access to information from all three big credit bureaus – and to have the wider range of FICO information available to paying customers. Whether it’s worth the fees they’re asking is up to you and – we would argue – the specific circumstances you are in at a give point in time.

Either way you choose, be glad that there are so many good options for shedding light on this vital – and formerly exclusive – aspect of your financial well-being.Facebook:

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