If you’ve recently checked your credit scores at the three national credit reporting agencies (Equifax, Experian and Transunion), you may have noticed that your credit score varies between the three. After thoroughly reviewing your credit report, you may be asking yourself, “Why are my three credit scores different?”
Your credit scores are determined by a variety of factors, including the number of accounts you have, the types of accounts, your available credit, your payment history, and the length of your credit history. It can be difficult to pinpoint exactly why your credit scores are different because those differences can be related to these and other variables.
Timing is a factor. If you pulled a score from one agency in June and another in July, the score may vary based on the difference in your accounts over those months. For example, if there was a change to a credit card balance or an inquiry, or if a new credit line was opened, your credit score may fluctuate.
Credit accounts can vary between agencies. Creditors are responsible for reporting the details of your payment history to the credit reporting agencies. However, your creditors may not all report to the same credit reporting agencies, which would mean that each reporting agency may have a slightly different set of data it’s using to evaluate you. If you have five lines of credit, for example, all five may appear on one report while only four of the five appear on another.
The number of agencies to which a creditor reports can therefore have an impact on the scores you see from each agency.
Scoring models may be different. Individual credit-reporting agencies use different scoring models, so even if they each have the same information about you, their calculators may reach different results.
While all scoring models are designed to predict risk—where higher scores indicate to lenders a consumer may be lower risk—the results may vary depending on the agency that created a particular model.
A difference in your three credit scores from the three nationwide credit reporting agencies is generally normal, but there may be cause for concern if the differences are caused by inaccuracies. If there are any unfamiliar accounts or accounts familiar to you are overdue or in collections without your prior knowledge, they could be red flags of identity theft. You may want to dispute the error with the credit agency reporting it and then consider a fraud alert or security freeze if someone has gained access to your financial accounts without your consent.