CreditWise from Capital One is one of the most popular free credit monitoring services out there. Is CreditWise accurate, though?
When you're keeping track of your credit score, it makes sense for accuracy to be one of your biggest concerns. After all, you want to know that you're looking at the same credit score a potential lender is seeing.
The truth is, though, that each individual has a number of different credit scores. CreditWise allows you to monitor your VantageScore 3.0 calculated from your TransUnion credit report.Given this, is CreditWise worth using compared to the other options on the market? Let's take a look at what you should know.
What Is CreditWise?
CreditWise is a credit monitoring service that is offered by Capital One, one of the largest financial institutions in the United States.
When you think of Capital One, you probably associate the company with being a credit card issuer, but they also provide a wide variety of other banking services, including:
Both customers and non-customers of Capital One can use the CreditWise credit monitoring service.
While there are a number of different credit monitoring services out there that customers can use to monitor their scores and work to improve their scores, CreditWise is one of the free options on the market.
When you use CreditWise, you can:
- Access activity on both your TransUnion and Experian credit reports
- See your VantageScore 3.0 credit score
- Receive notifications if your personal and financial information is located on the dark web
- Access features that help you understand how different actions will impact your credit.
Understanding Credit Monitoring Services
There are two primary reasons why you might want to sign up for a credit monitoring service.
These are:
- To alert you of any changes or activity on your credit report to keep you aware of potential credit card fraud or identity theft as soon as possible
- Serve as a useful tool when you're trying to improve your credit score
Credit Monitoring Services and Identity Theft
If the wrong person gets a hold of your personal and financial information, it can wreak havoc on your credit profile and have a number of other deleterious effects.
Fraudsters can open up new accounts in your name or rack up charges on your existing credit cards. With the right credit monitoring services, you can be notified anytime there are changes to your credit report.
When you're the victim of identity theft, it can be a real bear to undo the damage. The sooner you are able to recognize that something fishy is going on, the less harm the thieves will be able to do.
- Using a credit monitoring service can save you hours and hours of time, not to mention a lot of stress.
Credit Monitoring Services and Building Your Credit Score
Beyond helping protect you from the damaging effects of identity theft, credit monitoring services can also be useful if you are working to improve your credit score.
Signing up for credit monitoring services can help you track credit growth over time. When you sign up, it only counts as a soft inquiry, which means that it won't negatively impact your credit score.
For example, maybe you've decided that you're going to purchase a home in the next few years. It can be wise to start paying attention to your credit score sooner rather than later. This way, you can ensure that your score is where you want it to be when lenders look over your application.
Common Credit Monitoring Service Features
There are a number of different services that credit monitoring services might offer, including:
- Credit report alerts: You might get a push notification or email if your credit report changes when you use a credit monitoring service. Depending on the service, reports might be monitored by one or more of the major credit bureaus.
- Credit locks: You might be able to lock and unlock your credit reports using your credit monitoring service, depending on the one you're using. This is something you might want to do if you think that someone has gotten their hands on your personal info in order to prevent them from opening any new accounts using your name.
- Monthly credit scores: You might receive monthly VantageScore or FICO updates as a part of your credit monitoring service.
- Identity monitoring: It's possible that your personal information is being bought and sold on the dark web without you even realizing it. Some services will scan the dark web and let you know if they find your info out there. Some also might track the use of personal info like your address and Social Security number (SSN).
- Fraud resolution: Depending on the service, they also might offer support if you need to dispute unauthorized charges and credit report records after identity theft.
How Does CreditWise Work?
CreditWise is a tool that lets you monitor your VantageScore 3.0 credit score.
There are two primary credit scoring models: FICO and VantageScore. Each of these credit scoring companies have released different versions over the years. CreditWise gives you access to your VantageScore 3.0.
You can access CreditWise from both your laptop or desktop as well as from your phone. Looking at your credit score on CreditWise won't ding your score.
This service is free regardless of whether you're a Capital One customer or not.
Capital One CreditWise Features
There are a number of features that Capital One CreditWise offers to help you keep track of your credit score and even work to improve it:
- Credit summary: You can receive weekly credit score updates with this service and check your credit score as often as you want to. The tool will also provide personalized information about factors that could influence your score.
- Credit alerts: Whenever something meaningful changes on either your Experian or TransUnion credit report, you can receive an alert. You'll also receive an alert if there are changes to the info on file with Experian or TransUnion regarding employment info, your address, or your public record.
- Dark web surveillance: CreditWise will scan thousands of unsafe sites, digital marketplaces, and hacking forums on the dark web and let you know if they find your email address or Social Security number out there.
- Credit report: CreditWise will also give you access to your TransUnion credit report whenever you want. They'll also give you tips for what to do next if you see any signs of theft, fraud, or inaccuracies.
- CreditWise Simulator: This tool can help you understand how your credit might be impacted if you take certain financial actions. For example, it could let you know the change you'd see in your score if you opened a new card, paid down credit card debt, or canceled your oldest credit card.
- Social Security number tracking: Finally, CreditWise will track whether your Social Security number is associated with other names, addresses, and aliases. You'll receive an alert if a new name or address is linked to your SSN.
Pros and Cons of CreditWise
If you're looking to stay on top of your credit score, CreditWise is a free resource available to everyone.
With any service like this, though, there are going to be pros and cons.
The Advantages of CreditWise
On the plus side, CreditWise lets you:
- Monitor your credit score for free: You can get a sense of your overall credit health by monitoring your credit score through CreditWise. The score you see will be calculated using the TransUnion VantageScore 3.0 model. They'll also give you suggestions that could help you increase your score.
- Receive alerts from your Experian and TransUnion credit reports: When you receive alerts about delinquent accounts, inquiries, or other changes to your Experian and TransUnion credit reports, it helps you stay on top of your financial health. It's also useful for ensuring you aren't a victim of identity theft. These features only involve soft pulls, so they won't change your credit score.
- Receive alerts regarding personal and financial information on the dark web: The sooner you realize that your private info is out there on the web, the better. This is a useful service offered by CreditWise to help you take the steps you need to protect your identity.
- Use their credit score simulator to learn how certain actions can impact your credit: Your credit score can feel mysterious sometimes. The credit score simulator offered by CreditWise can be a useful tool to help you understand how certain financial moves will likely change your credit score.
- Receive tailored suggestions to help you boost your credit score: Building credit can feel overwhelming, but this service gives you actionable tips you can follow to increase your score.
The Drawbacks of CreditWise
On the other hand, some of the cons of CreditWise are:
- It doesn't offer a FICO score: While your VantageScore and FICO scores are calculated using similar key factors, there can be differences between scores from different models. According to FICO, 90% of the biggest lenders use their model rather than VantageScore when making lending decisions.
- It doesn't track credit reports from Equifax: If a lender is using your Equifax credit report to make a lending decision, CreditWise might not give you the whole picture.
Is CreditWise Accurate?
When you use the CreditWise credit monitoring service offered by Capital One, you're receiving your VantageScore 3.0 calculated using your TransUnion credit report.
- Just like other credit monitoring services, CreditWise provides an estimation of your credit score based on one of your credit reports using a particular credit scoring model.
Each individual usually has multiple credit scores. There can be variations between scores depending on the credit bureaus, scoring models, and industry-specific needs of a lender.
So, is CreditWise accurate?
The answer is:
- It accurately depicts your VantageScore 3.0 calculated using your TransUnion credit report.
Credit monitoring services can be useful tools to help you monitor your financial health. At the same time, each of them will use certain credit bureaus and credit scoring models, meaning that there will likely be variations between scores depending on which service you use.
That being said, it's possible that the credit score you see will be slightly different than the score a potential lender will be looking at. Let's look closely at why you probably have several different credit scores and what this means.
Why You Have Several Different Credit Scores
When we talk about credit scores, we often discuss them as if each individual has one set credit score. The truth is, though, most people will have multiple credit scores.
- Credit scores are calculated using a credit scoring model and information found on credit reports.
Because there are a number of different credit scoring models and three major credit bureaus, most individuals don't just have one score.
How Variations Occur Between Credit Scores
Here are some of the key factors that influence your different credit scores and can explain slight variations between them:
- Credit scoring models: FICO and VantageScore are the most popular credit scoring models, but there are a number of others on the market. To complicate things, there are different versions that have been released by both scoring companies over the years. Credit scoring models use criteria and algorithms to calculate how creditworthy you are in the form of a three-digit number.
- Credit bureaus: The three major credit bureaus in the United States are Experian, Equifax, and TransUnion. The information collected by each reporting agency can be slightly different, which can lead to slight differences in your scores. Not all lenders will report to all bureaus as well, which can further influence differences in scores.
- Industry-specific scores: Sometimes, a lender or creditor will use a credit scoring model that is specifically designed for their particular market. For instance, mortgage lenders often use models that were created to directly assess an individual's riskiness as a home loan borrower.
- Score versions: New versions are periodically released for each credit scoring model. Lenders don't necessarily use the newest versions, though, so older versions can still remain relevant to your credit health.
When you combine all of these factors, each individual can end up with quite a few different credit scores. If you're applying for a loan or line of credit, the score that a particular lender will use can depend on the purpose of the evaluation, preferences, and industry standards.
How Does CreditWise Compare to Other Credit Monitoring Services?
Alternatives to CreditWise
There are lots of different credit monitoring services out there. CreditWise is only one of the options on the table.
Popular Free Credit Monitoring Services
Some other free services that are well-regarded for reliability and accuracy include:
- myFICO: There's a free version of myFICO as well as three paid identity theft plans. The free plan gives you monthly updates, FICO scores, and activity monitoring of your Equifax credit report. The paid versions offer additional features for credit monitoring and identity theft protection.
- Credit Karma: Another free service is Credit Karma, which monitors your Equifax and TransUnion reports. If you use it with Experian's free service, you can access info from all three bureaus. Credit Karma offers your credit score using the VantageScore 3.0 model.
- Credit Sesame: This is another popular free option. It offers daily credit monitoring alerts and credit scores based on your TransUnion report using the VantageScore 3.0 model.
Popular Paid Credit Monitoring Services
Some paid services that are well-regarded for reliability and accuracy include:
- IdentityForce: Rated the best overall paid service by CNBC for July 2023, IdentityForce offers your VantageScore 3.0, dark web scans, $1 million identity insurance, and credit monitoring from all three bureaus.
- Privacy Guard: Privacy Guard costs $9.99 to $24.99 per month, depending on the plan you choose. It offers your VantageScore and monitors reports from all three bureaus.
- Experian IdentityWorks: Rated the best credit monitoring service for families by CNBC, Experian uses the FICO scoring model and offers identity insurance up to $500k for the Plus plan and up to $1 million for the Premium plan. The Plus plan monitors your Experian report, while the Premium plan monitors reports from all three bureaus.
- Aura: Offering plans for individuals and couples, Aura is a paid credit monitoring service that monitors reports from all three bureaus and a monthly VantageScore report.
- Complete ID: This paid credit monitoring service is exclusively available to Costco members. It offers monitoring from the three credit bureaus, restoration services with 24/7 support, and digital security tools. It uses the VantageScore 3.0 model.
- ID Watchdog: The Premium plan from ID Watchdog was rated the best credit monitoring service for families by USA Today. The premium plan monitors all three credit bureau reports and provides scores based on the VantageScore 3.0 model.
For more information about other popular credit monitoring services, check out our post on Rocket Money and our guide to Credit Karma and Experian.
Improving Your Credit Score For Greater Financial Opportunities
Experts say that you should check your credit report and score at least once a year. However, checking in more frequently with your credit score can help you catch potential signs of credit card fraud or identity theft. It can also help you prepare for big financial decisions, such as taking out an auto loan or a mortgage.
- CreditWise with Capital One is one of the credit monitoring services you can use if you want to stay on top of your credit.
- It will both help you stay aware of changes to your credit report and monitor your score.
This service uses your TransUnion credit report to calculate a VantageScore 3.0. Since you have different credit reports and different credit scoring models, you probably have several different credit scores that might vary a bit.
That being said, using CreditWise or another credit monitoring service can be a great way to check in with your general financial health.
Have you realized it's time to build or improve your credit? Starting early before you expect a lender to check your credit can help you access broader financial opportunities down the road. Make sure you check out our Credit Building Tips blog for more valuable resources!
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