Credit Score?

Sinhanada

Morning all

I know that the credit score offered by companies such as Experian are meaningless to companies when applying for credit - but it has me thinking. How do these companies actually calculate your score?

Malmo

Using the sophisticated iRandomNumberGenerator.

Perhaps peruse this thread on this matter.

rockm87

They dont really work to a 'score' as such, but they have specific criteria.

which is why sometimes if you get refused credit by one company, you may still get it with another, as they are looking for different things.

DCFC79

Does it matter

Sinhanada

No it doesn't DFC79 - I was merely curious as to whether I'd receive suggestions such as what Malmo or rockm87 (Thank you both) have provided or if I'd get a derogatory reply such as yours. Either way my curiosity has been satiated.

rockm87

oh now thats not fair, its not a derogatory response.

Just a 'Hakuna Matata' response.

jamesd

They would typically calculate scores in similar ways to those used by the scores provided by credit reference agencies. They would than add information like income and filters for the types of customers or things they do or don't want to see and use those to arrive at a final decision.

Smaller firms might start out using the credit reference agency score as is, then gradually move towards increasing customisation and eventually on to a completely home-grown approach. Since the general principles are similar it's likely that any home-grown approach would reward or penalise many things in similar ways to the credit reference agency version.

A company that wants to offer balance transfers on credit cards might favour people who have prolonged balances on their cards and reject those who pay in full. One that is looking to eventually offer a mortgage might reject credit card applicants who consistently use a lot of credit and favour those that match their mortgage criteria for the area in which the applicant lives and local property values. Either might reject all applicants who have unpaid debts with them or any applicant who already has one or maybe two of their credit cards.

Sinhanada

Why even bother with a reply like that then rockm87? I view it as derogatory but then again maybe I'm just a little sensitive over those types of posts which contribute nothing to the actual topic?

rockm87

I know, but it takes all sorts :-)