Experian credit score

Nafta

Hi,

I am looking to get finance for a car and I am looking at my credit report. When I check with Experian it tells me it is fair 851/999 but when I used the free apps like the one credit club it tells me it is very poor with 435/999. Which one do I trust? Both have the same details for me. I don’t want to ask for finance for poor credit if I might be able to get a better deal? Does this make sense? 

la531983

Neither. Both are as irrelevant as each other. Check the actual data held on both, no lender sees the made up number. 

Nafta

la531983 said:

Neither. Both are as irrelevant as each other. Check the actual data held on both, no lender sees the made up number. 

Thank you for that. So how do I know if I can apply for good finance rather that opting for specific lenders for poor credit? 

la531983

I don't understand the question. 

Have you checked the data held on both to see if they are accurate? 

redrosebud

Nafta said:

la531983 said:

Neither. Both are as irrelevant as each other. Check the actual data held on both, no lender sees the made up number. 

Thank you for that. So how do I know if I can apply for good finance rather that opting for specific lenders for poor credit? 

It depends on your credit history, which is distinct from the arbitrary scores the CRAs provide.

Firstly, sign up for all three credit reports. Experian/MSE both show your Experian report. Sign up to Clearscore for your Equifax report, and Credit Karma for your TransUnion report. Some lenders report to all three, some report to only one or two. The vast majority at the very least report to both Experian and Equifax.

Do you have any defaults or CCJs in the last six years? If yes, that's "poor credit", even more so if they're not settled. If not, what's your payment history like? Do you have late payments on your credit file? If you're not sure, the easiest platform to see this at a glance is Clearscore. An isolated missed payment a few years pack isn't a huge deal; several missed payments or a more recent one is more of an issue, but all lenders have different internal scoring criteria (this score is totally separate from the "score" Experian etc. hold), so some may see this as more of a risk than others.

Do you have long credit relationships? Have you been with your main bank a few years, have you had a credit card with the same provider for a few years? Long relationships are good as they show stability.

Do you pay off your credit cards in full every month, or do you routinely carry a balance? What percentage is your credit utilisation? (Credit Karma is good for showing this, although not all credit card providers report to TransUnion so make sure yours are all on there before accepting this figure as gospel.)

Do you have unsecured loans? If so are you making payments on time?

Are your utilities on any of the three reports, and are you in good standing with these?

Are you on the electoral roll at your current address, and is this accurately reflected in your credit reports? I had to raise a dispute with Experian at one point because they had a similar but wrong address for me and this was impacting my ability to get credit.


All these factors paint a picture of your credit history. Generally speaking, if you're on the electoral roll, you've no defaults or CCJs, no long (three months or more) streaks of missed payments, no missed payments in the last two years, and you tend to stay under 50% credit utilisation, you're in a good position.


If all of the above doesn't really apply to you because you've never used credit, get yourself a mobile phone contract and a "credit builder" credit card to start building up history. For a lot of lenders, no history is about the same as bad history, but it's much easier and quicker to repair!

Hope that helps.

redrosebud

Also to add - if you find inaccurate information on your credit reports, get together proof that it's inaccurate and raise a dispute with the relevant CRA. State that you want the information corrected rather than adding a "notice of correction" - a lot of lenders will just ignore notices of correction. Make sure the inaccurate information is fixed before applying for credit as otherwise you may end up wasting a hard search. More than two hard searches on your report in the last year isn't a good look (although again, the impact will vary depending on the lender's internal scoring criteria).

Nafta

redrosebud said: but

Also to add - if you find inaccurate information on your credit reports, get together proof that it's inaccurate and raise a dispute with the relevant CRA. State that you want the information corrected rather than adding a "notice of correction" - a lot of lenders will just ignore notices of correction. Make sure the inaccurate information is fixed before applying for credit as otherwise you may end up wasting a hard search. More than two hard searches on your report in the last year isn't a good look (although again, the impact will vary depending on the lender's internal scoring criteria).

Thank you so much for all this information.

redrosebud

No problem! Good luck with the car finance!