You may have heard of the three main types of credit scores: TransUnion, Equifax, and Experian. You should be aware that each company uses a different model to calculate your credit score. The three main models, which are based off your credit history, are more inclusive to infrequent and new users. If you have a Very Poor credit score, you will probably have a difficult time getting approved for credit.
TransUnion
TransUnion and other types are used by lenders to get a snapshot about a consumer's creditworthiness. The scores are available for free and can be used by lenders to aid in making lending decisions. They can however vary greatly from lender-to-lender. Although most lenders use the same scoring system they may view applicants differently depending on how they were calculated.
TransUnion scores range from 300 to 850, with the lowest being 300. Equifax scores, on the other hand, range from 280 to 850. Both bureaus consider the average age and history of payments more important. FICO scores are more extensive and are based on credit history and financial condition.
Equifax, TransUnion, or Experian are the main credit bureaus in the United States. They all use different models to compute the scores, and the scores can differ from one another. This is why it's important to get your credit report from each agency.
Experian
The Experian credit scores range from zero to 549. However, they are not fixed. They fluctuate over time depending on your financial behavior. Credit scores are calculated by statistical algorithms. Each bureau's method of calculating credit scores is unique. To get your exact score you will need to consult your credit history with the bureau.
There are many methods to increase your score. Some credit score builders can help you raise your credit score for free. Experian Boost can help you raise your credit score 13 points. However, not everyone can take advantage of this service. It is only for those who pay their bills using an eligible account.
Always check your credit score at all three credit bureaus. Each bureau's scores differ by approximately 50 points. TransUnion or Experian can use different formulas when calculating your score.
Equifax
Lenders use the Equifax credit score to determine whether you are eligible for a loan. The score is based on the number of credit cards you have, how you pay off those cards, and the length of your credit history. However, you should understand that your score can change over time. Therefore, it's important to compare your score to that of the same time period in the past to determine whether or not you're eligible for a loan.
Equifax is a major financial bureau and maintains a large number of consumer credit scores. There is one problem. The company made an error in the coding process for some credit scores. It resulted in some incorrect information being calculated. This mistake affected millions of consumers, although most people didn't notice a material change.