Experian is one of the big three consumer credit reporting agencies in the United States together with Equifax, and TransUnion. These bureaus keep credit reports on consumers that provide a summary of their credit history info such as account type, payment history, balance owed, etc This credit report data is then used to fashion credit scores such as FICO score that gives creditors a quick view of the creditworthiness of the consumer. However, there is always confusion about whether the scores given for free by this company, Experian, are your actual FICO scores. Now let us consider this in a little more detail.
What needs to be highlighted here is the fact that we are not dealing with one FICO score, but many. However, there is a long list of FICO credit score models with sub-Score covering different lending categories such as auto loans, mortgages, or credit cards. FICO Score 8, which can be accessed through your credit report, is the most frequently used generic FICO score that delivers a comprehensive measure of your credit risk. If you hear lenders discuss your FICO score in general, they are likely referencing FICO 8. Today the three major credit bureaus do offer free credit scores in your report which are meant to give a general outlook of your creditworthiness. However, the sad part is that most of those scores do not owe anything to FICO models. They do not use FICO but what is referred to as a VantageScore shared by the three burns as a counterpart of FICO.
VantageScores and FICO scores can be as different as night and day for a consumer at one end of the credit spectrum but can be the same at the other end. The ranges also do not align well with each other concerning the model types. There are FICO scores and they range from 300 to 850 while VantageScores have a range of 301 to 990. Even more crucial, these scores employ various formulas and distinctly weigh credit report elements. For instance, while there are different VantageScore models, it is known that they are more lenient towards consumers with little credit histories than FICO models. For all these reasons, the free scores from Experian are not the same as the FICO scores that most lenders legally employ in their decisions to offer credit. Thus, using the score from Experian for gauging the credit health while applying for a mortgage or an auto loan may not give a clear picture of whether one will be able to get credit or not as well as the possible interest rates at which lenders may be willing to lend money.
Well, fair enough, but let me say this: while Experian does not state that the free scores they offer are FICO, They indicate in small print that it is a VantageScore based on Experian report data, provided for education purposes only. Although it is quite limited on what they can offer on their site, they do offer paid services where they give your FICO scores from the three credit bureaus and will update scores monthly to enable you to keep track of any changes. These packages are not very costly and also provide you with weekly notifications in case of anything significant that changes in your credit file from Experian. Being a subscriber of one of these packages means being able to view FICO 8 and other scores, as well as receive reports and monitoring.
Last but not least, a couple of things still need to be remembered even if you are to buy your FICO score at Experian. The FICO scoring model will also use credit report data from all three possible bureaus for your score compilation. But when you get it from Experian, the FICO score is determined by the information on your Experian credit report only. Thus, if you have some differences in your address histories or individual accounts at different bureaus your Experian FICO score will be significantly different from the score calculated on the data of Equifax and TransUnion. There is no package for obtaining a score which is created by using information from all three bureaus, except for purchasing it from myFICO. com which is FICO’s branch. They are currently the only company that provides your genuine three-bureau FICO scores. None of the bureaus, by themselves, can offer a complete picture of your FICO score.
In other words, although Experian does offer real FICO scores with some of the programs, be careful with the other ones they offer for educational purposes. Be sure to read the details of the service to know precisely what kind of score is being checked to prevent misunderstanding with the real FICO scores that are used by lenders. Additional value can be gleaned when you pay to directly obtain your FICO scores from Experian; however, the scores provided reflect only the FICO scores based on your Experian credit information. The only way to get your scores from the three different bureaus of FICO is to pay for them at myFICO. com and it is the closest way one will get his scores as any lender does. It is important to keep track of credit scores at least once a month, and it is also essential to review full credit reports as frequently as possible to identify any discrepancies immediately.
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