6 Things to Know About Free Credit Scores

It wasn't all that long ago that credit scores were a great mystery for many people. Consumers used to have to pay in order to see the three-digit number that so many creditors rely on to make lending decisions. However, all that has changed.

In 2014, the government's Consumer Financial Protection Bureau recommended credit card companies provide free credit scores to their customers. Many card issuers now offer this service, and third-party websites, such as CreditKarma and NerdWallet, also offer anyone the opportunity to view a free credit score.

While free credit scores can be an important tool for gauging your financial health, you should know these six things about them.

[Read: How Important is Your Credit Score?]

You probably won't be getting the same score as your creditor. Finance experts say the most common misconception about credit scores is that everyone has a single score. In reality, there are dozens, if not hundreds, of scoring options available. FICO, the largest credit scoring agency, says it has 28 scores that are commonly used. These include scores designed for specific industries such as auto and credit card lending. Plus, scores can vary depending on which credit bureau report is used for the calculation.

There are also newer companies in the industry, such as VantageScore. "It's like computer operating systems," explains Liz Weston, personal finance columnist for NerdWallet.com and author of "Your Credit Score ." "Windows is obviously the dominant one, but it has different generations. Apple is the upstart." Given that there are so many different credit scores available, it's unlikely the free one you're getting is the same one your lender is using.

Not all free credit scores are created equal. Some free credit scores will tell you exactly what you are receiving. They may mention the type of score -- FICO, VantageScore or another provider -- as well as the credit bureau used to calculate the score.

Other free scores are more ambiguous. "Instead of a FICO score, you're getting an educational credit score," says Jocelyn Baird, associate editor for finance site NextAdvisor.com. That educational credit score could be based upon a proprietary formula created by a website and bear little resemblance to the credit scores used by lenders.

[Read: 10 Simple Ways to Raise Your Credit Score.]

Free scores haven't entirely replaced buying access to a score. With so many free credit scores available, it might seem silly to shell out money to see your number. However, Weston says it may make sense for those getting ready for a major purchase. For instance, someone buying a house might want to see an older version of their FICO score, which is more likely to be used by a mortgage lender.

Not everyone is convinced it's necessary to see the same score used by a lender though. Theresa Williams-Barrett, vice president of consumer lending and loan administration at Affinity Federal Credit Union, says knowing the exact score used by a lender isn't as important as knowing generally whether you have good or bad credit. "The score you see [from a free source] is likely roughly what the creditor sees," she says.

Companies offering free scores are selling something. Consumers should think twice before inputting their credit card information for a free credit score. "There are some companies out there who say [the score] is free, but they're not," Williams-Barrett says. In these cases, people trying to access a free credit score may unknowingly sign up for credit monitoring or some other service that comes with a monthly fee.

Even if there are no strings attached, people should remember that companies offering free credit scores are still businesses. "If they are not charging you, they are trying to make money in some way," says Nicole Mayer, partner with wealth-management firm RPG-Life Transition Specialists in Riverwoods, Illinois. Credit card companies hope you'll sign up for their card while third-party sites may steer you to services for which they receive a commission.

Checking your score won't hurt, but consider who is getting your information. Another common misconception about credit scores is that frequent checking will lower the number. That's not true, Weston says. "The only way checking your score can hurt is if you have your friend at the auto dealership do it," she explains. Credit checks by potential lenders can lower scores, but the type of credit checks performed by free score services shouldn't have a negative effect.

Still, people may want to exercise caution when looking at their score. "The more times you put your information out there, the more risk you have it being stolen," Mayer says. She recommends finding trusted sources based on each of the three major credit bureaus and sticking with them rather than continually checking on new sites.

[Read: 5 Ways to Get Credit Bureaus to Remove Errors From Your Report.]

Free credit scores can be useful monitoring tools. Part of the value of checking a score on a regular basis is to watch for identity theft or fraud. If a credit score drops significantly, "you should see that as a sign to take advantage of your free credit report," Baird says.

By law each of the three major credit bureaus must provide consumers with a free copy of their credit report once every 12 months. The official website to request a free report is AnnualCreditReport.com. According to Williams-Barrett, the free credit reports are even more valuable than free credit scores. Since scores are based on data in the reports, it's crucial that information be correct. She recommends people request a report from a different credit bureau every four months to watch for potential problems throughout the year.

Free credit scores can be a barometer to gauge your financial health, but don't overlook their limitations or the risks that may come from requesting a score from an unreliable source.