Credit Scores, Reports & Credit Comparison (2024)

FAQs

How does a credit score compare to a credit report? ›

A credit report is a statement that has information about your credit activity and current credit situation such as loan paying history and the status of your credit accounts. Your credit scores are calculated based on the information in your credit report.

Simply put, there is no “more accurate” score when it comes down to receiving your score from the major credit bureaus.

Credit scores reflect how likely individuals are to repay their debts.

Your credit reports from Experian, TransUnion and Equifax could have different information because creditors can choose which bureau(s) they want to report to, as well as what they report and when.

If you are thinking about getting a loan, you may wonder what do lenders see when looking at your application. Not matter if you apply for a credit card or a personal loan, your lender will have a look at your credit report at some point during your application.

FICO scores are generally known to be the most widely used by lenders. But the credit-scoring model used may vary by lender. While FICO Score 8 is the most common, mortgage lenders might use FICO Score 2, 4 or 5. Auto lenders often use one of the FICO Auto Scores.

An Equifax credit score isn't used by lenders or creditors to assess a consumers' creditworthiness. Instead, many lenders use FICO Scores® to help determine a potential borrower's creditworthiness. FICO uses credit scores from the three reporting agencies, including Equifax and Transunion, to determine their score.

This is because Credit Karma makes use of another credit scoring model compared to many lenders and possibly does not have access to all the data required to calculate your credit score.

But, just how accurate are Credit Karma scores? They may differ by 20 to 25 points, and in some cases even more. When Credit Karma users see their credit score details, they are viewing a VantageScore, not the FICO score that the majority of lenders use.

Late or missed payments can cause your credit score to decline. The impact can vary depending on your credit score — the higher your score, the more likely you are to see a steep drop.

What does your credit score have to be to be considered good? ›

670 to 739: Good Credit Score

Lenders generally view those with credit scores of 670 and up as acceptable or lower-risk borrowers.

Making on-time payments to creditors, keeping your credit utilization low, having a long credit history, maintaining a good mix of credit types, and occasionally applying for new credit lines are the factors that can get you into the 800 credit score club.

While achieving a CIBIL Score of 900 is technically possible, it is extremely rare. Scores above 760 are considered very good or exceptional, providing significant benefits such as lower interest rates and higher chances of loan approval.

Credit score and mortgages

The minimum credit score needed for most mortgages is typically around 620. However, government-backed mortgages like Federal Housing Administration (FHA) loans typically have lower credit requirements than conventional fixed-rate loans and adjustable-rate mortgages (ARMs).

Some lenders report to all three major credit bureaus, but others report to only one or two. Because of this difference in reporting, each of the three credit bureaus may have slightly different credit report information for you and you may see different scores as a result.

For the majority of lending decisions most lenders use your FICO score. Calculated by the data analytics company Fair Isaac Corporation, it's based on data from credit reports about your payment history, credit mix, length of credit history and other criteria.

Both can be used by lenders to decide whether or not to grant you credit. Your credit score is important, but if you really want to dig into your credit and review your history, then you need your credit reports.

Credit scores are similar to a grade point average (GPA). They are a three-digit number, ranging from 300 (lowest) to 850 (highest), used to measure the risk that borrowers will become delinquent or default on debt obligations. Credit scores are based upon information contained within credit reports.

When applying for most loans, lenders will be sure to focus on your credit score – a three-digit number that plays an important role in qualifying for loans, credit cards, apartment rentals and more. However, your focus should be placed on something else instead: your credit payment history.