Today it is easy to get your credit score instantly. You can order it not only directly from the credit bureaus, but from many banks and sites such as: Credit Karma offer free credit score reporting. The downside of this easy access is that you can be more confused than ever by the discrepancies in all that information. Get your credit score from the three primary credit bureaus (Equifax, Experian, and TransUnion) and you’ll likely get three different numbers. What about that?
When FICO Isn’t Really FICO
People tend to refer to credit scores as FICO scores, but in fact FICO is not the only major credit scoring model in use. VantageScore is a rival scoring model, introduced in 2006 and used by all three credit bureaus. It looks at slightly different credit factors than FICO and weighs them differently, so it may yield a very different number than your FICO score. Depending on the source you use to access your credit score, you might look at your FICO score for one agency and your VantageScore score for another. To add to the confusion, there are different versions of both FICO and VantageScore, and not every credit score reporting source uses the latest version of the scoring models, which creates even more variation in the resulting scores.
Different agency, different data
Lenders are not required to report your credit activity to all three bureaus. In fact, they’re not required to report it, period. Some lenders keep all three agencies completely up to date, but others report to only one or two agencies or don’t bother reporting changes to your account at all. So your account history with each credit bureau is likely to be different, and that can lead to significant differences in your credit scores.
When lenders report account activity, they usually do so at different times. Most lenders report to the credit bureaus once a month, but for example, one lender may report to the bureaus on the first of the month while another may report on the 25th, for example. So if the credit score reporting tool you are using gets your Experian score from the 24th and your TransUnion score from the 26th, then the Experian score will not include the lender report from the 25th. If that lender report includes significant activity, such as a new maximum credit card or a change in late payer status, it can significantly affect your score.
What should a borrower do?
If you’re trying to find out your “true” credit score, you’ll need to dig a little deeper into the information your score is based on. Start by preparing your credit reports for each of the three bureaus. That shows you exactly what data they base your score on. If one of the bureaus is missing important information or has an account that is completely off base, such as a loan for someone else that is listed in your account history, then you can contact the credit bureau and have it fixed. That’s enough to get your credit scores in the same ballpark anyway. And when you look up your credit scores, you can also check that they use the same scoring model and date to resolve any discrepancies. You’ll probably never get all three scores exactly the same, but as long as they’re within a few points of each other, you can feel pretty good about their accuracy.