#2 What does your score mean?

Understanding your score.

To look after your credit score, it’s important to get a full picture of your finances. To do this, you can check in with all three UK credit reference agencies periodically. This is especially true before an important application like a credit card, loan or mortgage.

From lesson 1 you should have checked your credit reports with the three different credit reference agencies.

You’re probably asking one of these two questions:

1. Why do I have different credit scores?

Your Experian, Equifax and TransUnion (formerly Callcredit) scores may be slightly different because not all lenders report to every CRA. Some lenders only report to one or two CRAs, whereas others will report to all three.

CRAs also calculate their scores differently resulting in differentmaximum scores for each. Experian’s score is out of 999, TransUnions’ is 710and Equifax is 700.

So, your credit score might be 459 with Equifax, 999 with Experian and 609 withTransUnion, even with the same information reported to each. This is nothing to worry about as long as your information is accurate on each.

2. Why can't I find my score?

If you’re new to the country or you’ve never taken out creditbefore, it’s likely that you can’t access your credit report. This is becausethere isn’t any data shared with the CRA’s to build your credit history.

To start building your credit history you need to take out someform of credit. Unfortunately the way the system works, because you don’t have a history it’s harder to get access to credit. It’s a catch 22.

Don’t worry though, in lesson 3 we’ll provide some ways in which you can start building a credit history.

If you can’t find your score but you have taken out credit withinthe last 6 years, it’s either that the lender doesn’t report to that CRA, inwhich case you’ll benefit from the tips in lesson 3. Or there is a mistake onone or more of your reports with the CRAs and you need to take action now. See task #2 below.  

Task #2 - Review your report carefully (and fix any mistakes)

If you spot any mistakes on your report you should fix them as soon as possible by talking to the CRA.

Your credit score is based on the information held in your creditreport. If this information isn't accurate (e.g. an account appearing as 'open'when it is 'closed') then your credit score won't be either. By checking yourcredit report regularly, you can spot (and fix) any mistakes promptly, whichcan help boost your credit score.

If you find any mistakes on your credit report, you'll need to talkto the Credit Reference Agency directly:

Once any mistakes on your report are fixed you can move on to start taking proactive steps to improve your score.

Jump to lesson 3