Why Are Different Credit Web Sites Giving Me Different Credit Scores?

Financial experts frequently recommend that consumers take the time to run their credit history each year to make sure information is correct, current and that identity thieves have not opened fraudulent accounts under their name or Social Security number. If you've accessed more than one credit website, you may have noticed that you've received different credit scores. This may not be cause for concern. Understanding why different credit websites are giving you different credit scores will help you decide whether it's necessary to take action.

Use

Credit scores help lenders determine the risk involved with extending credit to you. Low credit scores often indicate that you've missed payments, made late payments, exceeded your maximum balance or allowed debts to fall into collections. Conversely, high credit scores indicate that you manage credit well by keeping your debt-to-income ratio low, paying more than the minimum required and maintaining longstanding accounts with lenders. High credit scores help you obtain preferred interest rates on home loans or auto loans, and can make a positive impression with potential employers or landlords.

Scoring Models

One reason why different credit websites may be giving you different credit scores (even when you've checked them on the same day) is that the numbers were generated through different models. The FICO credit score is probably the most commonly used scoring model available, but there are other options that credit websites may use to determine your score. The three major credit bureaus, which include Equifax, Experian and TransUnion, may thus generate different credit scores. Some lenders develop their own scoring models to generate credit scores; the methods in these models may not be available to the public, according to Fox Business.

Timing

Another reason why different credit websites may give you different credit scores relates to timing. Even if you've accessed scores on the same day, credit groups may calculate your score based on updated intervals that differ from one another. Some scoring models may update your score every 90 days, while other scores may be updated any time there's new credit activity. That means that your credit score from one website may reflect current information, while a credit score from another website may reflect your financial activity from three months ago. If you've recently taken out a large loan, missed several payments or paid down a big chunk of credit card debt, that may not have been factored into your new score.

Effect

Consumer websites offering credit scores to interested customers have generated what are called "educational" credit scores; that is, these scores give you a ballpark idea of what range of scores may be generated by different lenders. Banks may view entirely different credit scores when evaluating your credit application. While credit scores generated by credit websites and other credit evaluation companies help act as a signal to you that something negative has landed on your credit report, quibbling over small differences of a few points from these "educational" credit scores may not have any affect on whether a lender approves your loan application or what interest rate you're assigned.