Is It Worth Paying For Your Equifax Credit Report?

Posted by on June 20, 2019 @01:41:03 EDT
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What Credit Is

Credit cards with a padlock on top of them.
 

No matter who you are, if you’re trying to carve out a living for yourself in today’s high-speed, highly technological world, your credit score is a big deal. It’s one little number which makes all the difference when it comes to all of the major purchases we consider to be milestones.

Your first car—unless you’re one of the lucky few who can save enough cash to buy it up front—is going to require financing, and the terms of the loan you’ll be able to secure are going to depend on your credit score.

Becoming a homeowner is another one that springs to most of our minds when we think about credit scores, and for good reason: the conditions and interest rates of that loan, as well as the mortgage you’ll need to take out on a house, are also heavily dependent on your credit score.

How Lenders Use Your Credit Score

No matter who you are or where you live, if you’re making use of credit to finance these important purchases, that three-digit figure is the sole piece of hard data that lenders are going to look at in order to appraise your reliability as somebody they can lend money to.

The algorithm that makes the big decisions when it comes to calculating your score is a complicated one. It takes a lot of different factors into account, and the massive multinational companies who have proprietary rights over that same algorithm keep its inner workings a closely guarded secret.

After all, what’s the use of a score designed to reflect any given person’s trustworthiness if it’s easy for anybody to artificially inflate their own value?

Which is not to say we have absolutely no idea what to do about our credit scores.

Credit Score Repair

For one thing, if your credit score has taken a hit recently, there are well-known, tried and tested credit repair techniques you can employ to get your own score back up to where it should be.

For another, we know some basic principles we should be following in order to ensure that we’re considered trustworthy buyers. Paying back everything on time is one; taking out a small loan initially and paying it back completely to create a solid base of credit is another.

But here’s the thing.

Whether you want to establish an initial foundation of good credit—or whether you’re trying to practice credit repair after an unfortunate incident left your figure lower than you’d like it to be—you’re going to need some way to keep track of that vital little number.

After all, how can you plan to make changes to something you can’t even see? Keeping track of your credit report is a crucial ability to have, even if you’re not trying to act on some credit repair processes. It’s a good thing for all of us, and we should all be making regular use of the credit reporting facilities that exist out there for us to take advantage of.

Equifax: Who Are They?

Equifax is a huge company with top-notch brand recognition. They’re practically a household name, at this point, and are likely to feature in any serious discussion about credit reports and credit repairs, whether that’s around the dinner table or at the water cooler in the office. Employing over 10,000 employees worldwide and based in Atlanta, Georgia, Equifax turns over US$3.1 billion in annual revenue, all by facilitating credit reports.

In the rest of this article, we’ll be discussing Equifax. In particular, we’ll talk about whether or not it’s worth it to pay for a credit report from Equifax. While we’ll be focusing specifically on the cases of those who need some credit repair work done, we’ll endeavour to look at the issue from all angles. (As a side note, if you’re engaged in the time-consuming process of performing credit repair on your own score and need a car, give us a ring here at Autoloan.ca. We consider every application for a loan we receive, irrespective of score.)

Do I Need Equifax?

Let’s start off by examining what exact role Equifax is actually playing in the credit industry today. The simplest way to do this is to have a look at what can be accomplished without Equifax.

To that end, the fact of the matter is no, you don’t need Equifax. Anybody is perfectly able to track their own credit reports by making use of some of the DIY credit monitoring services out there. Everybody has access to one free credit report a year from each of the three major credit reporting agencies (of which Equifax is one).

One clever way to make the most of this is to schedule the reports throughout the year, so they arrive in the mail once every six months. This should prove a good way to get a general snapshot of your credit as it progresses, and is certainly better than nothing.

These reports don’t actually include the credit score itself, however. That’s accessible via your existing credit card account. The problem with the DIY method is that, although it’s free, it’s nowhere near as comprehensive an overview of your affairs as a credit report that one of the major credit reporting multinationals (like Equifax) will be able to provide.

Given the importance of your credit to your life—not just your credit score, but your credit in general, including all of those other helpful facts companies like Equifax include on their reports—it just doesn’t make sense to cut corners. Even if everything is rosy and you don’t need to perform any credit repair, why take the chance?

Where Equifax Come In

Equifax have been in the insurance and credit game, in one form or another, since 1899. Nowadays, they work primarily in the business-to-business sector of the market, selling consumer credit reports and other related analytic data to a whole range of different businesses in different industries. The credit reports they sell include detailed information on the consumer in question, including the personal credit and payment history of the individual, all of which is intended to be used by the business to ascertain whether or not the person has honoured their financial obligations in the past, such as paying bills or repaying loans.

Since 1999, they’ve been offering services to the credit consumer—that’s where you and I come in. While they’re required by law to provide everybody with one free credit file disclosure every twelve months, they also offer credit fraud and identity theft prevention products. These are designed to help automate the first few steps of the credit repair process by limiting any damage done by criminals making fraudulent use of your details.

Paid Services Offered By Equifax

They currently offer a few different packages which vary in price but generally cost in the environs of $19.95 a month. These packages provide credit scores from all of the three major credit bureaus (not just Equifax), as well as Social Security Number Scanning and credit monitoring for up to four children.

Part of the fine print of these deals is that these other companies will not use your credit score as calculated by Equifax to evaluate you for a loan. Equifax uses their own algorithm to estimate these figures. Even if, according to the Equifax plan calculations, you have a score of 800 with Experian, there’s no way to be sure you’ll secure a loan from them, because the number presented to you isn’t the same number that Experian themselves use.

As well as these extensive credit monitoring deals, Equifax provide the consumer with a sizeable list of identity theft protection measures (which can be helpful if you’re engaged in credit repair). Some of these are free, like the Lock & Alert system, while others cost money. They also help you to place a freeze on your credit reports from any of the three main agencies.

Should I Pay?

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All of which brings us to the crux of our discussion: should you pay for Equifax’s credit monitoring services? Whether it’s credit repair you need or just a sharper eye over your affairs, are they a good option for you?

Obviously, this is a decision that only you can make. Just as you’re the only one affected by a bad credit score, and you’re the only one who can engage in credit repair to get it back to healthy levels—so too are you the only one who can decide if what Equifax is selling is something you want to buy.

But there’s something you should know.

Security Issues

A laptop displaying lines of computer code.
 

In early-to-mid 2017, Equifax suffered one of the largest data breaches in modern history, and far and away the largest breach to affect one of the three major credit agencies. The potential scale of the attack could have impacted around 145.5 million U.S. consumers, as well as up to 44 million British residents, and 19,670 Canadian residents.

Although the attack began in mid-May, it wasn’t noticed until the 29th of July. Information accessed by the hackers included first and last names, Social Security numbers, birth dates, addresses, and even driver’s license numbers.

One or two of these personal information categories are enough to wreak havoc: all of them together is a complete disaster. There was no way for any of the customers who had trusted Equifax to protect themselves. Every major aspect of their identity had been stolen, and everybody affected would have needed to spend a long, long time practicing credit repair techniques before they got their credit score back in order.

According to Dan Goodin, of Art Technica, the Equifax data breach was ‘… very possibly the most severe of all for a simple reason: the breath-taking amount of highly sensitive data it handed over to criminals.’ No amount of credit repair was ever going to completely make up for all the damage done in that one short month.

Nowadays, Equifax is back on their feet and have employed much more secure methods of defence, aimed at preventing any possible future attacks on any possible scale. But for many of their customers who explicitly trusted them with such highly personal data, the damage has been done—just like the damage has been done to Equifax’s reputation. It’s unclear if the company will ever regain the level of industry and consumer trust it once enjoyed.

The Takeaway

So there you have it. A thorough discussion of the highs and lows of Equifax, as well as on credit monitoring and the necessity for credit repair in general. Hopefully, you’ll be armed with enough information to make your own decision about what’s right for you, or at least to know how to go about conducting your own research.

We can’t tell you whether or not it’s worth paying for Equifax’s credit monitoring services. Only you can make that decision, and it’s going to be based on a range of different things, including whether or not you’re currently practicing credit repair.

As a final note, if you are engaged in the application of credit repair techniques at the moment and need a new car, send the team here at Autoloan.ca an email. Every application for a loan we receive is considered, so it certainly can’t hurt to try.