Here are some possible causes of the difference:
You might wonder why your Experian credit score is 100 points lower than your TransUnion score. In some cases, the credit scores provided by the three main credit reporting agencies, which include Experian, TransUnion, and Equifax, may differ because the agencies offer credit reports containing different information regarding the creditworthiness of the consumer. Below are some of the possible reasons why I have such a high score that is being reported by Experian but the one from TransUnion is much lower.
Differences in Reported Information
This is why some of your scores are different from one bureau to the next: not all of your credit details are shared with all three bureaus. For instance, you may find that a particular credit card appears on your TransUnion report but not a report from Experian. If that card has a lengthy and good record, it would increase your chances of having a good score for TransUnion when compared to the Experian score.
On the same note, there could be a negative item that only your Experian credit file will show like a late payment which brings your score down significantly. That blot would be considered in your Experian number but would not even touch your TransUnion number.
Utilization Rates
Another key driver of credit scores is credit utilization. This one is related to the total amount of credit limits for revolving credit that you have available and the extent to which you utilize it. They are only limited to a certain number of accounts and any slight variation in how much of those limits you have consumed on some accounts could take your score from one bureau to another by 100 points.
For instance, Experian can reveal a higher balance on some of the crucial credit cards compared to TransUnion in relative terms because of differences in the balance as stated in the latest accounts. For example, if patients’ average time spent in care or the number of visits per year is too high, it will affect your scores. Hence, if one bureau records higher rates, your score can be significantly lower with that credit bureau.
Errors in Reporting
The third possibility could have been a reporting discrepancy between what you have on your Experian credit file and what you have on your TransUnion credit report. If for instance a particular lender or creditor reports negative information to Experian you have never incurred or which is so incorrect such as late payment or high balances this will greatly lower your score with them.
On the other hand, if positive account data is not reported to your Experian file, it also means that your credit score will drop if you are not getting your usual credit for the accounts. Comparing the reports from both bureaus and going through them will help to determine the erroneous entries that lower the Experian number in comparison with TransUnion.
It is also important to be aware that there are differences in FICO scoring models depending on the version.
Alternatively, the two scores you are comparing may be derived from different FICO scoring models, which are available. Experian and TransUnion most likely also use FICO models but could be using different versions of them. Two current variants of the FICO score are the FICO 8 and a newer FICO 9 model. It means that if one report utilizes FICO 8 while the other report has FICO 9 or another slightly older model such as FICO 7, there are differences in scoring results.
Weighting Factors
Although the FICO models compare credit data of similar nature such as payment records and credit balances, the scale of such comparisons can be slightly distinct between model versions. For instance, later FICO versions also seem to focus more on total consumer credit balance and credit utilization ratio. If Experian is using an earlier score version that counts things differently, it might lead to a lower score than the TransUnion FICO 8 score.
Mismatched Scoring Products
It is also relevant to note that business organizations do not make decisions based on pure base FICO scores alone. For certain industrial verticals, there are FICO Auto Scores specifically designed for use in auto lending decisions, and Bankcard Scores for credit card business. Comparing a base FICO 8 score from TransUnion to an Auto Score from Experian is two completely different apples and oranges scores that cannot be compared. That could easily account for a one-hundred-point or larger difference between the two teams.
Still, one may only compare one score per bureau just to know which of the two is more accurate in reporting credit scores.
Another situation that could have provided the same perceived very different scores is that of just employing only one score model from each bureau rather than all the risk scores from both. For example, you may have run your credit report using the Experian FICO 8 score while your score from TransUnion was VantageScore 3. 0. This is because, despite covering similar credit data, FICO and VantageScore models apply different scoring ranges, so a 100 point difference can be a result of mere comparison between an apple and an orange.
Is there a certain credit score that is considered more important?
That is why it may be quite natural to focus on why the scores are different, but the primary question is – why do you need these scores from Experian and TransUnion at all? It is important not the score per se, as any particular lender/creditor decides on your application and which bureau data they decide to employ in this process.
In a case where you are looking for credit for a certain purpose such as mortgage, auto, or credit card, check if they operate Experian or Trans Union credit reports. The most important criteria that will be used to consider your application to their institution will, therefore, be that credit score. Increasing your rating with the bureau that is used by a lender is crucial for the approval probability.
The Takeaway
Any discrepancy of 100 points or more between your scores on Experian and TransUnion credit reports is due to differences in your accurate credit information provided to those bureaus. It is important to know which particular attributes pull down your Experian score if you want to bolster it later on. However, finding out if the lender has used any score to evaluate you is more crucial than focusing on any single score type. It is useful to keep track of all your scores because it is much more useful to know how they are used when it comes to making credit decisions.
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