Experian showing excellent score which can't be true

Eternal1

Hi,

I made a thread the other day explaining I've had poor credit history when I was younger but that was 5 years ago and I've never had a credit card before. I signed up for Noddle and it showed my credit score as 603 (fair) which seems about right, however I just signed up for the free experian account and it shows my score as 969 (excellent) which simply cannot be possible as I've never even had a credit card before.

Is this a glitch when first opening an account or is the free version just lying to me to try and get me to apply for credit cards or what? Seems very strange.

Thanks.

https://i.gyazo.com/aa2d672bbfa9c8de762724dadff2e248.png

Willing2Learn

You should ignore your scores as a lender neither sees nor uses them. A potential lender scores you against their criteria and independent polices using the data in your credit file plus the data submitted in an application.

Eternal1

Willing2Learn wrote: »

You should ignore your scores as a lender neither sees nor uses them. A potential lender scores you against their criteria and independent polices using the data in your credit file plus the data submitted in an application.

My concern is I don't want to apply for credit cards thinking my score is good and get rejected which only harms my future prospects at getting a card. What's the point of having a credit score if it's meaningless then?

Willing2Learn

The score is used by the CRAs to sell products (they are acting as a credit broker). My score has gone down from excellent to fair in the last six weeks, but my credit history stored within my credit file hasn't changed, except for eight searches and 6 new credit accounts. I suppose it could be argued that the Experian score could be considered an indicator of how you may be viewed by creditors. I just ignore my scores and apply for credit when the need arises. I check my 3 credit files regularly though.

[Deleted User]

It's to keep you coming back and to buy their add ons.

You've rightly spotted that it's a pile of old horse poop, generated largely via a magic 8 ball. High scores are given to those with no credit history, 18 year olds and bankrupts, as well as some of those who deserve a high score. Experian scores reward inertia (which is why bankrupts score so highly, as they are unable to get further credit).

Ignore it and just look at the data - that will give you a good indication of your situation, or ask on here.

Eternal1

Willing2Learn wrote: »

The score is used by the CRAs to sell products (they are acting as a credit broker). My score has gone down from excellent to fair in the last six weeks, but my credit history stored within my credit file hasn't changed, except for eight searches and 6 new credit accounts. I suppose it could be argued that the Experian score could be considered an indicator of how you may be viewed by creditors. I just ignore my scores and apply for credit when the need arises. I check my 3 credit files regularly though.

Ok thanks.

So basically how do you actually know if your credit score is good or not then? If the score isn't what credit card agencies or mortgage brokers etc go off then I can I myself know if my credit situation is actually good or not?

Almost every site and video I've ever watched about credit always mentions credit score and if it's 700 you can get this and that or if it's under 650 you won't get this or that etc. Seems very strange that it doesn't actually do anything and can just be some random number

[Deleted User]

Eternal1 wrote: »

Almost every site and video I've ever watched about credit always mentions credit score and if it's 700 you can get this and that or if it's under 650 you won't get this or that etc.

You've been watching American sites. It's different there.

You just need to aim for good credit history and avoid the negatives - eg late payments, too much debt, defaults.

Get on the ER, get a credit card and clear it in full each month.

Eternal1

Deleted_User wrote: »

You've been watching American sites. It's different there.

You just need to aim for good credit history and avoid the negatives - eg late payments, too much debt, defaults.

Get on the ER, get a credit card and clear it in full each month.

I've just applied for my first credit card, the capital one platinum with £200 limit and I'm on the ER so from here on I'm starting the journey to increase my credit history. I'm also going to try and stay under 20% credit utilisation as I heard that's really important too.

Just a little disappointed about the credit score thing because that's the only real way to gauge how well you're performing and how likely you are to get accepted for new cards and mortgages, loans etc but if it's not relevant then you don't really know how good your credit rating is.

Thanks for the replies.

Willing2Learn

Eternal1 wrote: »

Just a little disappointed about the credit score thing because that's the only real way to gauge how well you're performing and how likely you are to get accepted for new cards and mortgages, loans etc but if it's not relevant then you don't really know how good your credit rating is.

You will know your credit history is improving by regularly checking your three credit files. Lenders like to see a good history of credit account management. So, if you have no late payments, arrears, over credit limit, or other bad markers you know that your history is improving. An improving history means you will be scored more positively by potential lenders.

SnowTiger

Eternal1 wrote: »

Hi,

I made a thread the other day explaining I've had poor credit history when I was younger but that was 5 years ago and I've never had a credit card before. I signed up for Noddle and it showed my credit score as 603 (fair) which seems about right, however I just signed up for the free experian account and it shows my score as 969 (excellent) which simply cannot be possible as I've never even had a credit card before.

Is this a glitch when first opening an account or is the free version just lying to me to try and get me to apply for credit cards or what? Seems very strange.

Thanks.

https://i.gyazo.com/aa2d672bbfa9c8de762724dadff2e248.png

Experian seems to give everyone a starting score of 999, then knocks points off for bad behaviour.

That means someone with no or little history is likely to score high.

Prospective lenders will look at the actual data on your report when making a discussion, along with other information you give them. Salary and household make up for example. No or little data means you have no or little track record regarding credit.

If that's the case, you're realistically looking at Vanquis, Capital One or a starter card from Barclaycard or Tesco. An organisation you already have financial dealings with might score you higher, based on the data they hold about you.

Fingerbobs

Willing2Learn wrote: »

I suppose it could be argued that the Experian score could be considered an indicator of how you may be viewed by creditors.

Couldn't agree more on this point. It is true that prospective lenders don't see or use the credit score provided by Experian, but surely Experian must base this score on similar criteria to those a lender would use to "score" your creditworthiness?

It must be a reasonably good indicator of how you're doing. I don't think the Experian score is completely without merit, as most around here seem to.