Why Do Each of My Credit Reports Have a Different Credit Score?

Circa 1997, that was one of my interview questions when I was interviewing for my job at FICO.  Whew, it’s a good thing I answered correctly or I might be writing about something other than credit.  This is one of the more maddening aspects of credit reports and credit scores…why can’t their be consistency?

There is no one answer to my interview question.  In fact, there are two.  The reasons you have different credit scores across the credit bureaus are:

1. Your credit reports are different – Your credit reports may be heavily redundant but they’re not going to be carbon copy images across the three credit bureaus. You may have an account that is missing from one report.  Or, you may have an inquiry that’s only on your Experian report but not on your Equifax or TransUnion report.  And, even if the account data was the same there’s no guarantee that they would be updated at the same time each month.

2. FICO’s scoring systems are not the same across the credit bureaus – Even if you did have the same exact credit report at all three credit reporting agencies your FICO scores would not be the same because their models differ bureau by bureau. This has been portrayed as a negative, but it’s really a positive. The explanation is highly technical so I’ll save you that punishment by explaining it using a sports analogy… when you’re a football coach do you have the same game plan for every one of your opponents?  Of course you don’t.  You customize it taking into account their strengths and weaknesses.  If you’re a baseball pitcher do you pitch each batter the same way?  Of course not.  You pitch certain hitters one way and other hitters a different way.  Consistency in credit scoring means you’re lacking the ability to compensate for data weakness or your lacking the ability to take advantage of data strengths.

Also, read >  A Higher Credit Limit? Yes, Please!

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