Credit Score Check: How Scores Are Generated and Read

What a Credit Score Check Refers To

A credit score check is the act of retrieving a number that a scoring model has produced from the contents of a credit file. The file itself is maintained by a credit reporting company, while the number is generated on request and is not stored as a permanent part of the record. A score exists only as the output of a particular model reading a particular file at a particular moment.

The three nationwide credit reporting companies in the United States are Equifax, Experian, and TransUnion. Each maintains its own file about a consumer, and those files can differ because lenders are not required to furnish information to all three. Because the underlying data can differ, the numbers generated from it can differ as well.

A check that a consumer initiates for themselves is generally recorded as a soft inquiry. Soft inquiries are visible to the consumer but are not supplied to lenders for lending decisions, and they are not used in the calculation of credit scores. A lender's request made in connection with an application is typically recorded as a hard inquiry instead, and hard inquiries are a distinct category of information on a credit report.

• A score is not the same thing as a credit report, which lists the accounts, balances, and payment history behind it.
• A score is not a single fixed number that follows a consumer everywhere.
• A score is a snapshot generated by one model version at one point in time.

Who Calculates Credit Scores

FICO and VantageScore are the two scoring model families most widely used in the United States. Both are developed by companies that are separate from the credit reporting companies, and both are licensed to lenders and to the credit reporting companies that distribute scores to consumers.

Each family includes several versions, or generations, of its model. A lender chooses which version to use for a given type of decision, which is one reason a score seen by a consumer may not match the score a lender relies on. FICO also publishes industry-specific versions designed for bankcard, auto, and mortgage lending, and those versions weight the same file information differently.

The credit reporting companies distribute scores built on these models, sometimes under their own brand names, and some lenders build or buy additional internal models. A single consumer may therefore have several different scores in circulation at the same time, each tied to a specific model and a specific file.

What the Number Reflects

Scoring models describe their inputs in broad categories rather than publishing exact formulas, which are proprietary. Commonly described categories include payment history, the amounts owed and how they compare with credit limits, the length of credit history, how recently new accounts were opened, and the mix of account types in the file. The relative weight given to each category varies by model version.

Negative information also appears in the calculation and remains on a credit report for set periods under the Fair Credit Reporting Act. Most adverse items, such as late payments and collections, are reportable for seven years. A completed Chapter 13 bankruptcy is generally reportable for seven years, while a Chapter 7 bankruptcy is generally reportable for ten years, though the credit reporting companies remove some bankruptcies earlier than the maximum.

Because the exact formulas are not public, no outside party can state precisely how a given change in a file would translate into a number. Scoring models are also updated over time, and a model version may later be replaced by a newer one with different characteristics.

Where a Credit Score Check Can Be Obtained

AnnualCreditReport.com is the federally authorized source for the free credit reports that the Fair Credit Reporting Act entitles consumers to request from each of the three nationwide credit reporting companies. That site delivers credit reports, not credit scores. The reports show the account and inquiry data that scoring models read, which makes them a useful companion to any score a consumer obtains elsewhere.

Many banks, credit unions, and credit card issuers provide a credit score to their customers at no charge as part of an account relationship. The score shown is usually based on one specific model version selected by the institution, and it may or may not be the version a particular lender would use for a particular loan application.

Paid subscription products also offer scores, often with monitoring features. Whatever the source, the number reflects the model and the file that source used, so the source and model version are worth identifying when a score is received.

• AnnualCreditReport.com, for free credit reports from the three nationwide credit reporting companies.
• Banks, credit unions, and card issuers that offer a score to account holders.
• Nonprofit credit counseling agencies, many of which review reports and scores with consumers.
• Paid subscription services that bundle a score with monitoring.

Why Scores Differ Between Sources

The most common reason two credit score checks produce different numbers is that they read different data. If one lender reports an account only to two of the three nationwide credit reporting companies, the files at those companies will not match, and neither will the scores calculated from them.

A second reason is the model itself. FICO scores generally use a range of 300 to 850, and VantageScore 3.0 and 4.0 use the same 300 to 850 range, while earlier VantageScore models used a range of 501 to 990. Two scores drawn from the same file but different model generations can land in different places, and a number should always be read together with the range and model it came from.

Timing is a third factor. Lenders report account information on their own schedules, often monthly, so a balance or payment recorded in one file may not yet appear in another. A score retrieved immediately after an account update at one company may not match a score retrieved the same day from a company that has not yet received the update.

The practical result is that no single number is authoritative for every purpose. The score that governs a specific decision is the one the decision-maker actually uses, drawn from the model and file that decision-maker has chosen.

Reading a Score Alongside the Credit Report

A score by itself explains very little, because it does not show which records produced it. The credit report holds that detail, including account statuses, balances, payment history, collection entries, and the inquiries recorded on the file. Reading the two together gives a clearer picture of what a scoring model was working from.

The Fair Credit Reporting Act gives consumers the right to dispute information in a credit file that is inaccurate or incomplete. Disputes are filed with the credit reporting company, which must investigate and respond within the timeframes the law sets, and with the furnisher of the information. The Consumer Financial Protection Bureau publishes guidance on how that process works and what documentation helps.

Scores are also used outside of lending. Insurers use credit-based insurance scores in many states, utilities and landlords may review credit information, and employers may review credit reports, though employment screening typically involves the report rather than a score. Terminology differs across these settings, so the first step in interpreting any number is identifying what it measures and which model produced it.

• A score is a summary; the credit report is the record behind it.
• Score ranges vary by model, so a number is only meaningful alongside its range.
• Credit-based insurance scores and employment screening reports are distinct from the lending scores described here.