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CreditWise from Capital One Review

CreditWise from Capital One Review

*Editorial Note: This content is not provided or commissioned by the credit card issuer. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by the credit card issuer. This site may be compensated through a credit card issuer partnership.

This article was last updated Aug 27, 2018, but some terms and conditions may have changed or are no longer available. For the most accurate and up to date information please consult the terms and conditions found on the issuer website.

There seems to be a never-ending list of free credit services available today, with most credit cards now offering free access to your credit score. Even if your card doesn’t have such a feature, there are several free services that you can use to see your credit score and factors influencing it.

Capital One provides one of those services: CreditWise®. CreditWise® has an interactive dashboard that allows you to view a wide range of factors affecting your credit score and explore how taking certain actions will affect your credit score. This service is available online and via your mobile phone (through the App Store and Google Play) for everyone — regardless of whether you’re a Capital One account holder or not.

What makes CreditWise® stand out among other services?

We recommend using CreditWise® for the simulator feature that allows you to see how positive and negative actions may impact your credit score, such as applying for a loan, paying a bill, allowing accounts to become delinquent and more. Of course, taking one or more of the actions you simulated may increase or decrease your score more than the simulator suggests.

Overall, CreditWise® is a good way to stay up-to-date on the latest changes to your credit score and TransUnion credit report. The platform is user friendly, no matter what level of credit knowledge you have, and there are plenty of explanations for every factor of your credit score.

However, if you’re mainly looking for your free credit score and don’t plan on using the simulator, we recommend Discover’s Credit Scorecard, because it provides a free FICO® Score — FICO® Scores are more widely used by lenders when determining your credit eligibility.

How to sign up for CreditWise®

1. Fill in your personal information. This includes: name, birthday, SSN, phone number, email and home address. Then, review the terms and conditions and select “Locate My Credit Info.”

 

2. Next, you will need to confirm your identity by answering a series of questions. The questions typically pertain to your personal information.

 

3. Once your identity is verified, you can create a username and password, then begin using your account. You may not receive a confirmation email right away. It took a few days for my email to arrive, but you can still use your account prior to receiving the email.

How to use CreditWise®

CreditWise® has five different navigation tabs — home, simulator, report, alerts and activity — that allow you to explore and learn about the various factors affecting your credit score. Below we’ll show you what information is provided on each tab and how you can use that information to potentially improve your credit score and influence your future credit actions.

Dashboard

The dashboard is visible from any navigation tab that you click on, and allows you to view several things about your credit score:

  • What your credit score is and what category it falls under (below average, average, good, or excellent)
  • When your credit score will be updated next (scores update every seven days)
  • How many points your score changed from last week (if any)

CreditWise® obtains your credit report from TransUnion and uses the VantageScore 3.0 model to find your credit score. Like the more widely used FICO scoring models, VantageScore 3.0 has a score range of 300-850.

For the sake of CreditWise®, the credit categories are:

  • Excellent: 761-850
  • Good: 701-760
  • Average: 621-700
  • Below average: 300-620

More information on the credit score ranges can be found by clicking the three dots above the “updated” date.

Home

The home tab provides an overview of your account and describes what affects your credit. Below we break down the six boxes displayed on the home tab and what they mean. You can also click each box for more detail and explore individual simulators that tell you how certain actions may affect your credit score.

  1. On-time payments: Payment history is the most important factor of your credit score, and paying on time is key to showing lenders you can pay back what you borrow. Since I made 100% of my payments on-time, I received an excellent rating.
  2. Oldest credit line: Lenders tend to look at the average length of your credit history more than your oldest credit line, so take this section lightly if you receive a good or excellent rating. For example, my oldest account is 18 years old, which is considered good. But, if you factor in my three new accounts in the past two years, my average length of credit history drops to around five years.
  3. Credit used: This is also known as amounts owed or utilization rate. It’s simply the amount of credit you use divided by your total credit limit. For example, I currently owe $600 across all my credit products and my total credit limit is a combined $30,010 — $600 / $30,010 = 2%. The less amount of credit you use, the better it is for your credit score. We (and CreditWise) recommend using less than 30% of your total available credit limit. Since mine is very low at 2%, I received an excellent score.
  4. Recent inquiries: Lenders take notice of how many inquiries you’ve had and consider too many recent inquiries as a sign of a risky borrower. Try to minimize applying for credit products to when it’s necessary. My rating in this category is listed as excellent since I have zero inquiries within the past two years.
  5. New accounts: If you open several accounts in a short time period — typically within two years — lenders may think you have credit problems. Try to open accounts only when needed. I’ve opened three new accounts within the past two years so I received a good score.
  6. Available credit: This is the amount of credit you can currently use. So whatever amount is listed, you can spend. For example, I have a “good” amount of available credit at $29,410. If I wanted to, I could use it all, though I won’t — and you should never max out your credit limit, either. This goes back to point three on credit utilization and maintaining a utilization below 30%.

Simulator

The simulator tab is a great feature that allows you to see the effect certain actions — such as paying off debt, making purchases and carrying a balance — could have on your credit score. For example, if I were to pay off $600 in credit card debt, the simulator suggest my score would increase seven points. But, if I allow one account to be delinquent for 30 days, my score would drop 92 points.

Note: The amount of points your credit score increases or decreases varies by user and is just an estimate.

View our top picks for credit cards with excellent credit.

Reports

The reports tab provides information from your TransUnion credit report. You should regularly review the information listed to see if there is any theft, fraud or errors. The information you can review includes:

  • Accounts & Balances: Clicking on this lists the accounts you have and their balances. You can also see a breakdown of your balances owed by account type (credit card, real estate, auto loans, personal loans and other).
  • New, Negative and Disputed: Click on these options to see the breakdown of your accounts that are newly opened, reporting a negative pay status and have an ongoing dispute investigation.
  • Inquires: You can review any inquiries you may have on your account. Click on “inquires” for more detail.
  • Public records: If there are public records of your debts, including bankruptcy filings, tax liens or civil judgments, the number of such records will be displayed and you can click on “public records” for more detail.

Alerts

CreditWise® conducts credit and identity alerts and will alert you if your credit report changes, there is suspected misuse of your Social Security number or your identity is associated with dark web activity. This information will be displayed under the “alerts” section.

Activity

Every seven days your credit score updates and your score’s history will be tracked on the activity tab — just note that your score may not change every week. You can see a graph of your score’s progress month-to-month by clicking on “history.”

 


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