The Wallet, a Wall Street Journal blog, is reporting that Sears-Kmart MasterCard customers are now receiving free TransUnion FICO scores each month. HSBC, the issuer of the card, joins Washington Mutual as the only other credit card company to offer this free* perk to customers.
The Wallet adds a few caveats for those who are thinking about applying, though:
However, if you’re dying to monitor your credit score, the Sears-Kmart card is one way to do it for free — but it works in your favor only if you avoid racking up a huge balance and are willing to take the temporary ding to your credit score when you apply. (Applying for a new line of credit counts as a hard inquiry on your report.) Still, even if you never use the card again after the initial signup (and you probably shouldn’t), it’s a rare and potentially helpful benefit.
Good advice. I would add that applying for a new card will also reduce the average age of your credit history, too. For more details on how FICO scoring works, see my story on the topic here (link).
*After I originally published this story, I called HSBC to find out about this particular card. It's called the Sears Solutions MasterCard. One cannot apply for the card online. Instead, you must go to a Sears store and apply there. Depending on your credit history, annual fees range from $0 to $59. The break points are $0, $19, and $59 per year. If you receive a card with an annual fee, then the FICO score you receive each month can't really be called free, right? Something to think about.
Last month I wrote about the Bankcard Industry Option FICO score that Washington Mutual provides to its customers. If you're not up to speed on this particular score, you might want to give my story a read. You can find the story here (link).
In the meantime, be sure to read the rest of the Wallet story: Why You Might Actually Want a Retail Credit Card (link here).