If you’ve ever checked your credit scores from all three credit bureaus, you’ve probably noticed a variation in your scores. Experian may say your score is a 650 while TransUnion has you at a 635. So where does that score variation come from and how can you close the gap and even out your scores?
The Source of Score Variation
There are three major credit bureaus: Experian, TransUnion, and Equifax. Each credit bureau keeps track of your credit in the form of a credit report and a credit score. This score, more likely than not, will be different from each of the bureaus.
The variations in your credit scores are a result of creditors not reporting to all three credit bureaus. It is a cost to creditors to report to the credit bureaus, so many choose to only report to 1, maybe 2, of them. In other words, it is possible to have a credit card that never reports to 2 of the credit bureaus. So if you miss a couple of payments, only one score will go down, but if you make every payment on time, only one score is going to receive the benefits.
Evening Out Your Credit Scores
The only way to close the gap between your scores is to use a creditor that reports to more than one bureau. When applying for a credit card or loan, make sure to ask how many credit bureaus they report to and only work with a lender that reports to 2 or 3 of the bureaus.
When it comes to mortgages, lenders actually throw out the highest and lowest scores and make their decision based on the middle score. If you have one credit card that you’ve been using for 15 years without missing a single payment, but it only reports to one bureau, all that hard work and dedication is going to be thrown out.
To ensure that all 3 of your credit scores accurately depict your credit, you must work with creditors who are going to report to more than one credit bureau.
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