Is Discover FICO Score Accurate
Discover is a credit card issuers in the US but in this article we will be looking at the free credit score that they offer to everyone, even those who are not their card holders. But before we can answer the question, 'Is the Discover FICO score accurate?" we first need to explain a little about Discover and also determine what a FICO score is made up of.
Discover is a credit card issued by Discover Financial Services, a publicly listed corporation on the New York Stock Exchange. As at June 30th 2022 its market cap is $26.8billion.
What is a FICO Score?
Banks and other lenders need to determine the risk of a potential client before they give them any money. The reason for this is that the banks need to protect themselves and insure that they make a profit.
They do this by assessing a variety of elements of the client' financial history and existing debt. Examples of this could include previous non-payment or late-payment of monthly installments, as well as previous declarations of bankruptcy.
All of this culminates together in a score which can differ depending on the country that you live in, and one country's score does not necessarily translate to another. In the US, the score is generally out of 850, with 'good' being considered any FICO score above 670.
There are many different ways that you can see your FICO score. But sometimes you might notice that there are differences between several different platforms. Discover FICO Score may differ from others for a variety of different reasons.
Why is it important to know your FICO Score
A FICO score can either enable your financial future, or it can hinder you. If you know that you have a good FICO score then you may be aware of certain opportunities such as business loans and mortgage opportunities which may be available to you.
Likewise, if you do not have a good FICO score, it is better if you are aware of it. If you know what the problem is, such as missed payments in the past, then you will know how long it will take your credit score to recover, or you might be able to realize that there are certain hurdles that you might have to get around, which will prevent you from over committing, or might allow you to find alternatives before you start on your various ventures.
For example, if you have a bad credit score, and you are aware of it, then it might be better to apply for a mortgage in the name of your partner, rather than jointly, thus increasing the chances of being approved.
Why the Discover FICO Score can Differ from Others
Your Discover FICO score may differ from FICO scores that you obtain through other places. The reason for this is that there are three main credit reporting agencies that institutions may report your financial activity to.
These include TransUnion, Experian, and Equifax. Not all institutions may report to all three agencies which means that the reports that can be pulled from each of the three agencies may differ.
For example, if you have outstanding payments on your credit card, then the financial institution through which you have your credit card may report this problem only to Experian, because that is who they work through.
Discover only makes use of TransUnion. They will not have information that has been exclusively shared with any of the other reporting agencies and thus the score might differ from one that you may see elsewhere.
Should I use Discover FICO Score?
Despite the fact that the Discover FICO score is not perfectly accurate all the time, it is not any better or worse than any other credit score.
TransUnion will be just as accurate or inaccurate as Equifax or Experian. Because it is completely free, even to those that do not have a Discover credit card, it is worth looking at.
Alternatively, if you wish to compare credit reports from all three of the major unions, then you can do so for free as well, although access to this is limited. One such example is Annual Credit Report.com which allows you to draw one free report every year from TransUnion, Equifax, and Experian.
However, for someone whose credit score is critical to their plans more short term than a single year. The Discover FICO Score is accurate enough that it would prove incredibly useful.
How to Use the Discover FICO Score
In order to see your Discover FICO Score without a credit card with Discover, simply visit the Discover website. You will require basic information such as your email address, billing address and social security number, after which you will be enabled to open an account which can then be used to view your FICO score.
You can then check your FICO score as often as you would like without it affecting your score. However, it is important to notice that if you experience a credit freeze, you will not be able to see your updated score through Discover. Only once the freeze has been removed will you be able to continue viewing your score.
Regardless of who you are, it is important to know your FICO score. It will either provide a variety of different opportunities which will help you to further yourself financially, or it will hold you back in many ways.
For most people, just knowing their credit score is sufficient should be more than enough, but for those we need to be able to view their credit score often without it affecting their score, the Discover FICO Score is more than accurate enough to be able to show you changes on a monthly basis, or even more often if you require it.
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