Credit Score Dropped in a month

[Deleted User]

beany_bot wrote: »

From the mouth of martin lewis himself.

"Interestingly, lenders don't see this score at all - it's just for you. The score you see reflects what's actually in your file, which is what lenders will look through when you apply for a credit product."
https://www.moneysavingexpert.com/loans/credit-rating-credit-score/

I'm amazed Martin doesn't know that the agencies are just using a random number generator. He really should know better...

Poiint 9 on that page:

Credit reference companies will try to sell you a credit score
Don't take it too seriously. Your credit reference agency credit file is important. ]ts credit score isn't.


Credit reference agencies used to make all their money from selling data to lenders. The idea was to help lenders predict your behaviour, which allowed them to assess whether or not you were a good person to lend to.

Then some bright spark at the credit reference agencies realised they could generate a business called "consumer credit management". It meant they could start to sell you all the other sorts of data and monitoring products for the first time. Why do they sell it to you? Well, it makes them money.

Part of this is selling people a "credit score". Yet that isn't a true indication because, as we've stressed, each lender scores you differently and they have far more information than just what's on your credit file.

System

!!! wrote: »

Poiint 9 on that page:

Credit reference companies will try to sell you a credit score
Don't take it too seriously. Your credit reference agency credit file is important. ]ts credit score isn't.


Credit reference agencies used to make all their money from selling data to lenders. The idea was to help lenders predict your behaviour, which allowed them to assess whether or not you were a good person to lend to.

Then some bright spark at the credit reference agencies realised they could generate a business called "consumer credit management". It meant they could start to sell you all the other sorts of data and monitoring products for the first time. Why do they sell it to you? Well, it makes them money.

Part of this is selling people a "credit score". Yet that isn't a true indication because, as we've stressed, each lender scores you differently and they have far more information than just what's on your credit file.

At what point does it claim it is random there? I am not denying that they use your score to try and sell you things. I am not denying that your score on its own is of very little value.

I am combating the myth that so many peddle. that your score is "completely random"

[Deleted User]

beany_bot wrote: »

At what point does it claim it is random there?

The entire post - in that it says it's not an indication of your credit-worthiness.

Ergo - it's a random number

Willing2Learn

I don't think it is a random number. There is an algorithm used to generate a number using the available data on your file. The hard sell comes from CRA attempts to hoodwink users into believing that lenders use the same algorithmically generated number too!

molerat

I paid off a £6K stooze credit card that had been on minimum payments. I then paid off a £5K stooze card, again on minimum payments. On both occasions my score went down but lenders were willing to give me more cards. Go figure.

nick74

I must admit the term 'random' does grate a little with the pedant in me whenever I see it used on here!

I could for example generate a credit score by taking someone's age in years, adding it to the years at their current address, then multiply by the number of credit cards they hold. The resulting 'score' would be of absolutely no use to them whatsoever, but it wouldn't actually be random either.

System

Willing2Learn wrote: »

I don't think it is a random number. There is an algorithm used to generate a number using the available data on your file. The hard sell comes from CRA attempts to hoodwink users into believing that lenders use the same algorithmically generated number too!

Exactly. It's not a random number.

From Martin Lewis RE credit scores "Does that mean it’s completely worthless and I should ignore it? No, I wouldn’t go that far. It's a loose indication of your rough creditworthiness"
https://forums.moneysavingexpert.com/discussion/4974939/what-your-credit-score-really-means

Yet you have people pedalling misinformation that the score is entirely random on every. single. thread.

Carrot007

beany_bot wrote: »

....They aren't "made up". Not at all.

They are created by people yes?


All things people create are made up yes?


Radio is made up.


Made up does not have the negative connatation that many people here think it does.


However score by agencies are indeed irrelivant as they are nothing to do with the score when you apply for anything.