Differences in Credit Score Between Bureaus

Credit bureaus gather, categorize and assess a borrowers history over a period of seven to 10 years. Currently, there are three major nationwide credit bureaus in the United States: Equifax, Experian and TransUnion. Although the 1974 Fair Credit Reporting Act (FCRA) regulates all three, it is possible for there to be variations in information from the three bureaus for one borrower. These variations can affect a borrowers credit FICO score, named for the Fair-Isaac Corporation that started scoring credit in 1958.

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Credit bureaus only know what creditors report. A single creditor such as a car finance company or a credit card issuer can be very diligent and report information monthly to the bureaus. Creditors can also be less than perfect about reporting information. In such instances a balance due amount could be different between each report. Also, not all creditors report to all three bureaus. Subscribing to a credit bureau is a service the creditor pays to receive. As such a small creditor may only subscribe to one or two of the three bureaus. Differences between the three different reports will reflect the absence of information.

Due Dilligence

Credit bureaus are obligated by law to update and maintain credit histories. It is impossible, however, for the bureaus to be 100% accurate and diligent when managing millions of records. When a credit report item expires or is eliminated by the subscribing creditor there is a chance that the item is not removed from the report. Credit bureaus are allowed to report civil judgments for seven years. If one of the three bureaus, however, fails to remove the judgment entry on a report, it will be different from the other two reports that had the item removed.

Its important for borrowers to occasionally check their credit reports to ensure all information is accurate and up to date. Again, the FCRA demands credit bureaus verify information is correct or remove it from the borrowers report.

Different Policies

Although the FCRA regulates how credit bureaus manage the information on a borrowers report, all three bureaus have different policies regarding what is reported. As such the final FICO scores from each bureau can vary by several points.

Different Scales

There are competing credit scoring systems such as VantageScore, which arrive at different numbers than FICO. A borrower should not only know the various scores attached to a credit bureau report but also what are considered high (good credit risk) and low (poor credit risk) numbers. Different companies use different scales. A 700 score on a bureau report can mean different results depending on the different scoring systems. For example, Experian grades credit on a scale of 330-830, while Equifax and TransUnion use scales of 300-850. VantageScore uses a scale of 501-990.