Score
- What is a Credit Score?
- Once my credit report is updated, how long before my score is updated?
- Does every inquiry affect my score?
- How is the TransUnion Personal Score Calculated?
- I corrected things on my credit report and my score went down. Can you explain.
- What is a good score to get?
- Will I be penalized for shopping around for the best interest rate?
- Do credit lenders use the TransUnion Credit Score?
- Why don’t I have a Personal Credit Score?
- How can the TransUnion Personal Credit Score help me?
- Can I use the TransUnion Personal Credit Score to apply for credit?
- What is a factor description?
- Why do lenders use credit scores?
- Is there just one type of score?
- What are the advantages of credit scores?
- How do inquiries affect my score?
Q What is a Credit Score?
A A credit score is a statistically derived prediction of an individual’s credit risk at a particular point in time. Credit risk is typically defined as the likelihood of an individual becoming seriously delinquent (ie. 3 payments past due or worse) within a 12-24mth period in the future). The score is a three-digit number that lenders use to help them make decisions. A higher score indicates that the individual is a better credit risk to a lender.
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A A credit score is a statistically derived prediction of an individual’s credit risk at a particular point in time. Credit risk is typically defined as the likelihood of an individual becoming seriously delinquent (ie. 3 payments past due or worse) within a 12-24mth period in the future). The score is a three-digit number that lenders use to help them make decisions. A higher score indicates that the individual is a better credit risk to a lender.
It is important to regularly review your own credit score to understand how you may be viewed by lenders and other businesses when submitting applications for credit products and services. Get your Credit Score now at www.creditprofile.transunion.ca
A credit score is:
- An objective summary of the information contained in your credit report at a particular point in time.
- A number that lenders use to help them decide whether or not to give any given person a loan or credit card and the risks associated to whether or not they can expect to be paid in accordance with the credit agreement.
- An objective and non-biased lending tool used by lenders to provide the consumer with a faster, equitable and more consistent response.
- A number that is made up of 6 main categories of information from your credit report:
- Payment History (maintaining Credit) – What is your track record?
- Amount of credit you owe (total balances) – How much is too much?
- Utilization of credit – How close are your balances to their credit limits?
- Length of time credit established (Credit Experience) – How established is yours?
- Search for an acquisition of new credit (new accounts and inquiries) – Are you taking on more debt?
- Types of credit established (Credit Mix) – Is it a healthy mix?
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Q Once my credit report is updated, how long before my score is updated?
A Credit scores are calculated when requested by a lender based on the most current information available on your credit file.
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A Credit scores are calculated when requested by a lender based on the most current information available on your credit file.
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Q Does every inquiry affect my score?
A • No. The only inquiries that would affect your credit score are those initiated by you for specific credit transactions or access from companies attempting to collect on a debt that may be past due (i.e. collection agency). Also, most scoring models take the appropriate steps to ensure that your score is not lowered because of the multiple inquiries that might occur in a specific time period as a result of shopping for the best terms for an auto or home loan.
Also, the score excludes inquires when:
A • No. The only inquiries that would affect your credit score are those initiated by you for specific credit transactions or access from companies attempting to collect on a debt that may be past due (i.e. collection agency). Also, most scoring models take the appropriate steps to ensure that your score is not lowered because of the multiple inquiries that might occur in a specific time period as a result of shopping for the best terms for an auto or home loan.
Also, the score excludes inquires when:
- A credit grantor has verified your identity for the purpose of offering you credit.
- A credit grantor with whom you have a business relationship has reviewed your account with them.
- You have received your personal credit report.
Q How is the TransUnion Personal Score Calculated?
A To calculate a score, numerical weights are placed on different aspects of your credit report and a mathematical formula is used to arrive at a final credit score. TransUnion calculates your credit score based on many factors of your credit history and payment behavior. These many factors may include but are not limited to:
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A To calculate a score, numerical weights are placed on different aspects of your credit report and a mathematical formula is used to arrive at a final credit score. TransUnion calculates your credit score based on many factors of your credit history and payment behavior. These many factors may include but are not limited to:
- How you are paying your accounts
- How much money you currently owe
- How long your accounts have been open
- What different types of credit you use
- How much credit you use compared to the amount of credit you have available
- How often and how recently you have applied for credit
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Q I corrected things on my credit report and my score went down. Can you explain.
A The effect on your score due to changes made to your TransUnion credit report depends on the nature of the information that was changed, what information is left intact and what other items on your credit report have been updated during the time that the corrections were made.
Some specific reasons why your score may not have improved include:
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A The effect on your score due to changes made to your TransUnion credit report depends on the nature of the information that was changed, what information is left intact and what other items on your credit report have been updated during the time that the corrections were made.
Some specific reasons why your score may not have improved include:
- Your TransUnion credit report included several negative items and some but not all of them were removed. The presence of one or more negative items may still have an adverse impact on your score.
- Your TransUnion credit report reflects some positive changes but there may have been new updates to your file that offset them such as higher balances reported on accounts, new account openings or new credit inquiries.
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Q What is a good score to get?
A There are several types of credit scores available. Typically, the higher the score the better. Each lender decides what credit score range it considers to be a good credit risk or a poor credit risk. For this reason, the lender is the best source to explain what your credit score means in relation to the final credit decision. After all, they determine the criteria used to extend credit. The credit score is only one component of information evaluated by lenders.
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A There are several types of credit scores available. Typically, the higher the score the better. Each lender decides what credit score range it considers to be a good credit risk or a poor credit risk. For this reason, the lender is the best source to explain what your credit score means in relation to the final credit decision. After all, they determine the criteria used to extend credit. The credit score is only one component of information evaluated by lenders.
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Q Will I be penalized for shopping around for the best interest rate?
A Most scoring models take the appropriate steps to ensure that your score is not lowered because of the multiple inquiries that might occur in a specific time period as a result of shopping for the best terms in an auto or home loan.
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A Most scoring models take the appropriate steps to ensure that your score is not lowered because of the multiple inquiries that might occur in a specific time period as a result of shopping for the best terms in an auto or home loan.
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Q Do credit lenders use the TransUnion Credit Score?
A Currently, there are some lenders that do use the TransUnion score but most credit lenders use their own scoring tools to make a credit decision. While the overall purpose of credit scores is universal, there are numerous score products in the market today that measure different components of an individual’s credit worthiness. Each lender will use his or her own criteria to measure an individual’s credit worthiness. The only way to find out about how they measure this is to ask the individual credit lender.
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A Currently, there are some lenders that do use the TransUnion score but most credit lenders use their own scoring tools to make a credit decision. While the overall purpose of credit scores is universal, there are numerous score products in the market today that measure different components of an individual’s credit worthiness. Each lender will use his or her own criteria to measure an individual’s credit worthiness. The only way to find out about how they measure this is to ask the individual credit lender.
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Q Why don't I have a Personal Credit Score?
A A credit score cannot be calculated because one or more of the following has occurred:
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A A credit score cannot be calculated because one or more of the following has occurred:
- Your credit report does not contain at least one account
- A remark on one of your accounts references a person who is deceased
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Q How can the TransUnion Personal Credit Score help me?
A You can use your TransUnion Personal Credit Score to help you learn more about your use of credit and the types of tools lenders are using when making credit decisions. Credit scores are one of the primary tools a lender considers when determining the risks associated to lending to you. Lenders use scores to determine whether or not to grant credit and if so, how much credit and at what rate? Lenders may also access and consider your complete credit report, which can provide further support on a given component of the score that could impact their final decision. However, as most credit decisions are made very quickly, it is the credit score that is most often used.
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A You can use your TransUnion Personal Credit Score to help you learn more about your use of credit and the types of tools lenders are using when making credit decisions. Credit scores are one of the primary tools a lender considers when determining the risks associated to lending to you. Lenders use scores to determine whether or not to grant credit and if so, how much credit and at what rate? Lenders may also access and consider your complete credit report, which can provide further support on a given component of the score that could impact their final decision. However, as most credit decisions are made very quickly, it is the credit score that is most often used.
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Q Can I use the TransUnion Personal Credit Score to apply for credit?
A Most lenders will access their own scoring tool(s) to assess a consumer’s credit worthiness so they may not be interested or ask for the consumer score you have obtained online. However, you can use the TransUnion Personal Credit Score to gauge your credit worthiness for future credit applications and needs.
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A Most lenders will access their own scoring tool(s) to assess a consumer’s credit worthiness so they may not be interested or ask for the consumer score you have obtained online. However, you can use the TransUnion Personal Credit Score to gauge your credit worthiness for future credit applications and needs.
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Q What is a factor description?
A A factor description explains the top reason(s) why your score was calculated as it was. When you receive your TransUnion Personal Credit Score, up to four “factor descriptions” are also delivered.return to top
A A factor description explains the top reason(s) why your score was calculated as it was. When you receive your TransUnion Personal Credit Score, up to four “factor descriptions” are also delivered.return to top
Q Why do lenders use credit scores?
A Lenders use credit scores because it provides a fast and objective measurement in determining the risk associated to lending money.
As a result of using credit scores:
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A Lenders use credit scores because it provides a fast and objective measurement in determining the risk associated to lending money.
As a result of using credit scores:
- People acquire credit faster
- Credit decisions are far more equitable
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Q Is there just one type of score?
A No, there are literally thousands of score models used in the credit industry that consider different variables for different types of credit.
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A No, there are literally thousands of score models used in the credit industry that consider different variables for different types of credit.
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Q What are the advantages of credit scores?
A When examining an applicant’s credit report, many lenders find it valuable to have a numeric score based on the credit report itself. Credit scores can give lenders a fast, objective and impartial snapshot of a credit report and can be a helpful tool in making loan approval decisions. As credit granting processes become more efficient, customers can more quickly gain access to the credit they need.
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A When examining an applicant’s credit report, many lenders find it valuable to have a numeric score based on the credit report itself. Credit scores can give lenders a fast, objective and impartial snapshot of a credit report and can be a helpful tool in making loan approval decisions. As credit granting processes become more efficient, customers can more quickly gain access to the credit they need.
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Q How do inquiries affect my score?
A A common misconception is that every inquiry decreases your credit score a certain number of points. This is not true. While an inquiry is recorded on your personal credit report every time you, one of your creditors or a potential creditor obtains your credit report, the presence of inquiries has only a small impact on your credit score and certain types of inquiries (your inquiry to your file and account review inquiries) have absolutely no impact.
Inquiries have less importance than delinquencies, balances owed and the length of time you have used credit. In general, scores only consider inquiries from the last 12 months. Inquiries are usually more important on your credit score if you have a limited credit history.
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A A common misconception is that every inquiry decreases your credit score a certain number of points. This is not true. While an inquiry is recorded on your personal credit report every time you, one of your creditors or a potential creditor obtains your credit report, the presence of inquiries has only a small impact on your credit score and certain types of inquiries (your inquiry to your file and account review inquiries) have absolutely no impact.
Inquiries have less importance than delinquencies, balances owed and the length of time you have used credit. In general, scores only consider inquiries from the last 12 months. Inquiries are usually more important on your credit score if you have a limited credit history.
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