Four reasons why your credit scores can vary

It’s true in Minnesota and it’s true in Wisconsin. In fact, it’s true across the nation: your credit score is a crucial component of your financial life. Whether you are buying a house or purchasing a car, lenders look long and hard at your credit score to decide whether you should get a mortgage or loan.

Why credit scores matter so much

Mortgages and auto loans are important, but the three numbers in your credit score also play big roles in determining interest rates on loans and credit cards, as well as whether or not you can rent an apartment (and then set up utility accounts), get a phone, buy insurance – and in some cases, a credit score is the deciding factor in landing and keeping a job.

When you check your credit score with the three credit bureaus (Experian, Equifax and TransUnion) to see how you’ll be evaluated by lenders, you might find that your scores differ from one bureau to another.

Four reasons for different scores

A recent CNBC report looked at several reasons for score differences.

  • Credit score errors: your score can be damaged by errors. Sometimes the error will appear on only one credit bureau score and sometimes errors can appear in all three. Disputing the errors can repair your score and your ability to obtain financial products.
  • Score version: there are many versions of credit scores, including industry-specific scores that show lenders in those industries the likelihood that you’ll pay off your obligation. One example: the FICO® Auto Score 9 is used in vehicle loan decisions.
  • Credit bureau: your credit scores can differ from one credit bureau to the next because lenders aren’t required to report information to all three. Most, but not all, lenders do, but that can mean that the three credit bureaus aren’t analyzing the same data.
  • Different days: checking your scores on different days can mean discrepancies because a score is outdated.

CNBC says there’s one score to pay particular attention to, noting that “FICO® Scores are are used in over 90 percent of lending decisions.”