How to credit agencies distinguish an excellent credit report from a good credit report?

ryan60600

If someone has a credit score of 880 (a good credit score), and someone has a credit score of 980 (an excellent credit score)

How do lenders differentiate between the creditworthiness of these two people?
To me it seems very possible that both these people with very different credit scores could appear extremely similar on their credit report, and their credit history over the past 6 years - have the same credit utilisation, both haven't defaulted in 6 years, both of the electroal register etc etc so don't these two people look exactly the same to lenders, without there being a number to differentiate them?

MattMattMattUK

ryan60600 said:

If someone has a credit score of 880 (a good credit score), and someone has a credit score of 980 (an excellent credit score)

How do lenders differentiate between the creditworthiness of these two people?

You are comparing one made up, meaningless number to another, lenders do not differentiate between those people because they never see the credit score, it is entirely a marketing gimmick between you and the CRA.

ryan60600 said:

To me it seems very possible that both these people with very different credit scores could appear extremely similar on their credit report, and their credit history over the past 6 years - have the same credit utilisation, both haven't defaulted in 6 years, both of the electroal register etc etc so don't these two people look exactly the same to lenders, without there being a number to differentiate them?

Lenders run their own algorithms based on the data they get from CRAs, but they never see the score. The lender will also have the benefit of you disclosing your income and potentially rent/mortgage commitments to them as well, they will then decide if you meet their lending criteria and if you do what interest rate they wish to charge you. The score though, is always irrelevant. 

MorningcoffeeIV

Credit agencies do it by change.

Changes - good or bad - lose points.
No change - slowly gain points.

It gives poor quality results, but no one sees the credit scores apart from you, so it's fine.

Lenders do it by risk, which is driven by customer analysis.  So in your example, above, with identical circumstances (including income, financials associates, ER etc) would be similar risk.