The Credit Score You See May Differ from What Lenders See, but Does it Matter?

Last month the Consumer Financial Protection Bureau (CFPB) released the results of their study on credit score consistency. The study (read the full results here) tackled the issue of differences between credit scores available to consumers versus those commonly accessed by lenders.

The concern regarding credit scores is that consumers could obtain a score that is materially different than a score obtained by a lender. And, the two scores can be so different that the lender’s interpretation of the consumer’s credit risk could be different than the consumer’s interpretation of their own risk. This meets the road when consumers apply for credit expecting a certain type of credit offer based on scores they’ve obtained on their own. But, when the lender pulls a different score, which in some cases is much lower or higher, they respond with an offer that surprises the consumer.

The CFPB found that very thing could have happened to some 20 percent of the study participants. You can look at this 20 percent figure in two ways: On one hand, 20 percent isn’t that large of a percentage. On the other hand, 20 percent of the study sample is 40,000 consumers. Weighted up to reflect that actual size of a credit bureau database, 20 percent equals 40,000,000 consumers.

The value of consumers having access to credit scores via free sites, like Credit Sesame, is hard to dispute. Fifteen years ago, when I started working for FICO, I got the idea from my interaction with the outside world that consumers and many lenders didn’t know much, if anything, about credit scores. In fact, if a consumer knew there was such a thing as a credit score they would be considered an informed consumer. Things have changed. In today’s credit world, simply knowing that you have a credit score is the least a consumer could possibly know.

Today, we are reminded about our credit scores constantly. It’s hard to surf the web, go to a sporting event, watch TV, or listen to the radio without some sort of reminder that we have a credit score (and a credit report) and that we should check them from time to time. Many still argue that the credit reporting agencies should be required by law to give you a free credit score once every 12 months—similar to the annual credit report law.  There’s a problem with that suggestion.

Also, read >  Ask the Expert: Does Credit Counseling Hurt My Credit Score?

There is no one credit score (you remember our infographic on your 49 FICO scores, don’t you?). There is no one style of credit score. There is no one provider of credit scores. You have hundreds of different scores, used by countless lenders, provided by a myriad of companies, and they are constantly changing. Simply giving consumers a free copy of their credit score once per year wouldn’t do much good.

The bottom line is that trying to chase around all of your scores is impossible and completely unnecessary. If you have a good credit report, then you’re going to have a good score regardless of the scoring model. If you have a poor credit report, then you’re going to have a poor score regardless of the scoring model. If you have an average credit report, then you’re going to have a middle of road credit score.

You only have three generally recognized credit reports—one each from Experian, Equifax and TransUnion. It’s these three credit reports that are the basis for all of your credit scores—not some of them, all of them. This makes the job of credit management much easier than the job of credit score management.

John Ulzheimer is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO and Equifax, John is the only recognized credit expert who actually comes from the credit industry. He is the President of Consumer Education at, the credit blogger for, and a Contributor for the National Foundation for Credit Counseling. Follow him on Twitter »