How to Compare Your Equifax, Experian and TransUnion Credit Reports

Posts Tagged ‘TransUnion’

How to Compare Your Equifax, Experian and TransUnion Credit Reports

|

If you’ve thought about ordering your free credit report, which credit reporting bureau should you contact? Many people wonder what the difference is between the Equifax, Experian and TransUnion credit reports. Each credit reporting agency uses a different set of criteria and variables to calculate your credit score, and some lenders prefer to use one over the other. If you were to order a credit report from each credit bureau, you might find that your credit score varies by as much as 40 points between them. The three credit bureaus did develop the VantageScore In 2006 to eliminate this problem, but many lenders still use the FICO score five-factor formula.

Here’s a brief summary of the key elements of your Equifax, Experian and TransUnion credit reports, and what makes each one unique:

Key Elements of Your Equifax Report

Uses the Equifax Credit Score calculation, a proprietary model used by Equifax
Equifax Score ranges from 280 to 850 where higher scores indicate lower risk
Is calculated slightly differently than the standard FICO Score
Equifax calls the FICO score the BEACON® Score

Key Elements of Your Experian Credit Report

Uses the PLUS Score credit scoring system
Experian Score ranges from 330 to 830 where higher scores indicate lower risk
Part of Experian’s National Score Index used to calculate consumer financial statistics around the country
The FICO score is often called the Experian/Fair Isaac Risk Model

Key Elements of Your TransUnion Credit Report

Uses the standard FICO scoring system, also called EMPIRICA®
Calculated based on several elements, including your payment rack record, credit history, types of credit used and total amount owed
FICO score range is from 300 to 850

Understanding Your Credit Scores

If you are about to make a major purchase and know you will be applying for a loan or a credit card with a high credit line, you can check your credit score from all three credit reporting agencies a few months before your purchase. These three scores can give you an accurate view of your credit standing, and you will have time to make requests for changes if you notice mistakes or errors. Most people who have a credit score above 700 across all three scoring systems are pre-qualified for big loans.

Just keep in mind that most lenders take more than just your credit score into account when making their credit decisions. Each lender uses a different method to determine your creditworthiness, so a high credit score alone – regardless of which scoring system is used – doesn’t guarantee that you will receive the loan or line of credit.

What’s the Best Way to Get Negative Information Removed From My Credit Report

|

Author: The Money Coach

Question: One of my subscribers had a question. She asked, “What’s the best way to have negative information removed from my credit report?”

Answer: Negative information can legally stay on your credit report for seven years. For some negative information, such as a bankruptcy, it can be as long as 10 years. The subscriber didn’t say if this is correct negative information or if this was inaccurate negative information, and so that demands a little bit more explanation.

Certainly if there was an error that was reported about you to Equifax, Experian, or TransUnion, you should dispute that negative information in order to have it removed from your credit reports. The single best way to have negative information that is inaccurate removed from your credit reports is to contact the creditor directly, who said something erroneous and negative about you.

So if that was a utility company, a credit card company, perhaps your mortgage lender, an auto loan company, a finance company, a charge card company, a retailer, if any of them posted any negative information about you, such as you paid late allegedly; you had an account go to collections; you perhaps were 60 days or 90 days or more behind on your bill; any such negative information which indicates that you did not pay as agreed, and if that information is erroneous, contact that creditor first to try to have them to remove the information.

The reason I suggest going to the creditor first is that when they delete the information, they will update their records and that information is less likely to be reposted to your credit reports later. Sometimes, consumers want to go directly to the big three credit bureaus, Equifax, Experian, and TransUnion, in order to get negative information removed, and you might be successful in doing that.

However, frequently what a lot of people will find is that a month, two months, three months down the road that negative information might pop up on the credit reports once again. So that’s why it’s always best to go right to the source, to the creditor who has posted information about you.

Now if the information is outdated, you are also legally entitled to get that information removed from your credit report. According to the Fair Credit Reporting Act, if it is outdated, let’s say it is more than seven years old, then yes, you can contact the bureaus directly for that and say listen, “This is something negative; this is outdated, old information on my credit reports. Please delete this information immediately.”

You can do so by contacting the credit bureaus online. Each of them maintains a website. They also have mailing addresses for Equifax, Experian, and TransUnion that you can write to them directly to get negative information removed. I always suggest, though, to consumers that to have negative information that is inaccurate or outdated removed most expeditiously, it is best to use the online dispute services that are offered by Equifax, Experian, and TransUnion.

Negative information that is correct on your credit report, you don’t have a legal way, certainly, of getting the credit bureaus to remove that information. If you have negative information such as a collection account that is say three years, four years, five years old on your credit report and you contact your old creditor or perhaps the collection agency that previously handled the account, you might be able to negotiate a lump sum settlement with them to do something called a PFD, a pay for deletion.

This essentially means that you recognize that you had a bill that went past due. You may not have the entire amount to pay but you do have something that you can pay. In many cases, if it is a debt that is many years old‑three, four, perhaps may be five years old‑ that old creditor or collection agent, frankly, might be pretty happy to hear from you, because now they are going to get some money. After all these years when the debt has been written off as uncollectible, they are going to get some money instead of no money.

So sometimes, if you will offer them 0.25 on the dollar, 0.50 on the dollar, somewhere around there, they might be willing to delete that negative information from your account. If you are thinking of doing this strategy, get an agreement in writing upfront from the creditor or collection agency before you turn over a check or any kind of money to pay to have negative information removed from your credit report.

Key Differences Between Equifax, Experian and TransUnion Credit Reports (askthemoneycoach.com)
What Is the VantageScore and How is it Different from the FICO Credit Score? (askamoneyexpert.com)
5 Tips if You’re Facing Court Action from a Debt Collector (askamoneyexpert.com)

Key Differences Between Equifax, Experian and TransUnion Credit Reports

|

Author: The Money Coach

If you’ve ever pulled your credit files from each of the three major credit bureaus and tried to compare them, you know that certain information in your credit records likely to be different. But did you also realize that the manner in which the credit bureaus present your credit data is also like to differ substantially?

Here are some highlights of the differences between each credit bureau’s reports – and how that information can help you to both better understand and improve your credit rating.

Equifax Highlights

As of this writing, Equifax reports are the only ones that summarize “Open Accounts” and “Closed Accounts,” making it far easier to distinguish this information and choose which accounts you want to examine first. (With Experian and TransUnion, all accounts are grouped together and listed alphabetically).

Equifax files also often show an 81-month credit history for your credit accounts. In some cases, however, particularly for closed or paid accounts, you will see a statement saying: “No 81-Month Payment Data available for display.”

Experian Highlights

Experian credit reports contain a unique feature that many users find extremely enlightening. For all of the accounts listed in your credit file, Experian shows you “Status Details” indicating when an account is scheduled to fall off your credit report. For example, since positive payment history remains on your credit report for 10 years, an auto loan that you paid off and closed in July 2008 will show the following Status Details: “This account is scheduled to continue on record until July 2018.” By contrast, let’s say you had an account go to collections and ultimate get written off by a creditor. For those of you who with these and other negative marks in your credit file, you won’t have to wonder how long a certain blemish will haunt you. That critical “Status Details” section of your Experian report will give you that precise information.

With Experian credit files, you will also see a monthly “Balance History” for any accounts that are still open, or for those closed accounts with an outstanding balance. The “Balance History” information in Experian credit reports currently dates back to November 2007. Also included in the “Balance History” section will be a statement indicating was your high credit/high balance was has been, over different time frames, since November 2007. If you have accounts opened after November 2007, the Balance History data will reflect whatever time period you opened the account. For instance, it could say: “Between September 2008 and January 2010 your credit limit/high balance was $5,000.”

TransUnion Highlights

TransUnion has the most thorough employment data section in your personal summary. You can update or correct several fields, including: your current or previous employer’s name, the position you held and the date you were hired. Changing this information will not improve your credit score. However, if you ever seek a loan in the future, it will be helpful to have your information accurately reflected in your credit report to show a lender your hire date for a job, or the length of time you spent at a specific employer.

TransUnion reports list “Satisfactory” and “Unsatisfactory” accounts. They also include color-coded boxes (white, green, yellow, orange and red), with words or numbers inside of them, to indicate your payment history:

A white box with an “X” indicates unknown information
A green box with “OK” signals that your payment is current.
A yellow box with “30” means you were 30 days late on a payment.
An orange box with “60” means you were 60 days late.
A red box with “90” means you were 90 days late.
A red box with “120” means you were 120 days late.

Lastly, TransUnion also uses the notation “N/A” or “Not Applicable” to describe various accounts.

The Information Found In All Credit Reports

All credit reports – whether from Experian, Equifax or TransUnion – contain basic information that can be categorized into five primary sections:

Personal Information

These personal facts about you include your full name, date of birth, address, place of employment, and a partial listing of your social security number.

Summary of Accounts

Your account summary lists any information creditors have reported about your payment history on loans of all kinds, such as mortgages, credit cards, auto loans, and student loans.

Public Records

Any public record on your credit file – such as a judgment, tax lien or bankruptcy – will seriously lower your FICO credit score. However, judgments or bankruptcies listed as “dismissed” will not impact your credit rating because they will be ignored by credit-scoring firms, as if they never happened.

Inquiries

An inquiry in your credit file is a record of any application for credit that you made. For example, if you seek a mortgage or car loan, or even if you apply for a credit card or perhaps request an increase in your current credit card limit, any of these actions can result in an inquiry, also known as a “hard” pull of your credit file. (Pulling your own credit report is a “soft” pull and doesn’t impact your credit rating).

Consumer Statements

Under the Fair Credit Reporting Act, you are allowed to add a 100-word “Consumer Statement” to any of your credit reports if you have disputed an item in your credit files, but the item was not removed because it was verified by a creditor.

Scrutinizing your credit reports puts you one step closer to achieving a great credit rating because you will undoubtedly become better educated about your credit just looking at the highlights of each credit file, and the way that similar information is presented differently in each credit report. You’ll only be able to spot these differences, though, by closely examining your credit reports generated by Equifax, Experian and TransUnion.

If you want the most up-to-date copies of your credit reports, you can get them at no charge from AnnualCreditReport.com. Knowing what’s in your credit files is great, but you should also know your credit scores. So if you haven’t obtained your credit score in a while, read this post on how to get your FICO credit score free too.

Like this article? Check out bestselling books from The Money Coach!

How do I establish my first FICO score? (askthemoneycoach.com)
What is the PLUS Score and Do I Need this Credit Score or Just My FICO Score? (askthemoneycoach.com)
Here’s How to Get Your FICO Credit Score Free (askamoneyexpert.com)

Can You Bump Hard Inquiries Off Your Credit Report By Monitoring With Soft Inquiries?

|

Author: The Money Coach

“Soft” inquiries – even lots of them – will not bump off or remove “hard” inquiries on your credit reports. This is because all inquiries stay on your credit report for two years, and hard inquiries count against you, for the purposes of calculating your FICO scores, for one year.

What Is the Difference Between a “Hard” and a “Soft” Inquiry?

A hard inquiry in your credit file is a record of any application for credit that you made. For example, if you seek a mortgage, student loan or car loan, or even if you apply for a credit card or perhaps request an increase in your current credit card limit, any of these actions can result in an inquiry on your Equifax, Experian or TransUnion credit files. Other business-related transactions can also produce inquiries: Among them: signing a cell phone contract, launching new service with a utility provider (like a local gas or electric company), filling out an apartment rental application, and – as even using a debit card to reserve or pay for a car rental. All of these activities generate inquiries that are known as “hard” pulls. By contrast, when you examine your own credit report, or when an existing creditor does a review of your credit files, those are called “soft” pulls, and they do not impact your credit score. So let’s say you use a credit monitoring service, and you review your credit report each month – or even weekly or daily. Those “soft” inquiries will be noted on your credit files, but they won’t hurt your FICO scores, and they won’t make your “hard” inquiries go away.

Don’t Allow Excessive Hard Inquiries of Your Credit Files

The American Bankers Association says a single inquiry can drop your credit score by 35 points. According to the formula used by Fair Isaac Corporation (the company that created FICO credit scores), inquiries account for 10% of your score. So think about it this way: If your FICO score is 680 points, inquiries account for 68 of those points. Obviously it’s not that simple, because different elements of FICO’s formula are weighted differently, based on a slew of considerations. And inquiries can have a greater or lesser impact on your score depending on the length of your credit history and other factors. Nevertheless, to minimize the impact of inquiries on your credit rating, only apply for credit when you truly need it. And if you have to shop around – say, for a mortgage or a new car loan – do so within a concentrated period of time. FICO executives say that multiple inquiries for auto financing or home loans are treated as a single inquiry, so long as the inquiries all occur within a 14-day period. The idea, according to FICO, is for them to avoid penalizing consumers for shopping around for the best rate.

Ask The Money Coach

Posts Tagged ‘TransUnion’