Last year I completed two courses in the space of one, so this year I may have the possibility of having a free period. I was just wondering if having a free period looks bad to universities even if I have all my credits.
Universities see your transcript, not your schedule. They won't even know you have a free period unless you take less than a full load, in which it could conceivably look bad, but if you're still taking plenty of challenging courses I can't imagine them caring very much.
I seriously doubt that a university would care if you had a free period. Like Stephan hoyer said, the university probably wont know if you had a free period. I know a lot of students who had free periods in my senior class in high school who not only got into good schools but got good scholarships.