Finances

Transunion vs. Equifax: the credit reporting giants

Keep reading and discover how Transunion vs. Equifax work and how they calculate your credit score! Keep reading and learn more!

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Portland, OR, USA - Jan 19, 2022: Personal credit scores provide
Transunion vs. Equifax: the credit reporting giants. Source: AdobeStock

Are you curious about the two giants in credit reporting: TransUnion vs. Equifax? Are you wondering how they can determine your credit score?

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Wonder no longer! This post will bring a comparative analysis of the two companies and help you understand how they work! So keep reading!

Differences between TransUnion vs. Equifax

As you might imagine, your credit score is one of the most important numbers of your financial life! It tells a lot about your finances!

Lenders and creditors will highly consider it when it comes to approving you for any type of credit!

Well, that’s when TransUnion and Equifax come in! These two major credit reporting agencies will provide those credit reports to lenders and creditors!

Indeed, they offer the same service by collecting and providing credit information through personal information and public records!

But how exactly do they differ? To find out, keep reading! We’ll explain everything you need to know!

Equifax

Equifax is a major credit bureau! It was founded in 1899 and is currently based in Atlanta, Georgia!

Furthermore, Equifax utilizes the FICO scoring model. It is similar to the Vantage. Still, it has some slight differences.

For example, the scoring is based on a range of 280 to 850. If you have a credit score between 670 and 739, you have good credit!

Equifax considers the same key factors when deciding your credit score. Still, their importance will vary, as you can see below:

  • 35% is your payment history;
  • 30% is the amount owed;
  • 15% for the length of credit history;
  • 10% for new credit;
  • 10% for credit mix.

TransUnion

KONSKIE, POLAND - July 22, 2021: TransUnion agency logo on mobile phone
Differences between TransUnion vs. Equifax. Source: AdobeStock

Founded in 1968, TransUnion is currently based in Chicago, Illinois. As said, it provides credit reporting services.

When calculating your credit score, it uses the VantageScore model, based on a range of 300 up to 850.

As it suggests, the higher indicator means you’re financially responsible and worth the lender’s and creditor’s trust.

In addition, the VantageScore model takes into account some factors when calculating your credit score:

  • 40% is your payment history;
  • 34% is the amount you owe;
  • 21% length and type of credit;
  • 5% is your recent credit application.

How does TransUnion vs. Equifax calculate my credit?

As noted, TransUnion vs. Equifax has different scoring models. Still, they consider pretty much the same factors when rating a consumer!

And they will gather your credit information from similar sources too! Mostly, creditors will provide that information to those agencies!

Whether card issuers, banks, or lenders, if you’ve been their client at some point in your life, they’ve reported your activity to TransUnion and Equifax!

In addition, credit bureaus can access your financial information from public records, such as tax liens and bankruptcy.

Meaning that whether you’ve been a good or not-so-good client, they will know and put it on your credit report!

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Why my credit scores may differ?

Yes! This can happen. And trust me, that’s nothing extraordinary! As you can read above, TransUnion vs. Equifax are different companies!

Consequently, they use different algorithms to compute and calculate your credit score.

Indeed, they might receive the same information, but they will work it off differently. Also, each company may collect information that the other won’t!

So don’t worry if you find different scoring when looking for your credit report! You’ll have a good score at both if you’re a good consumer!

So remember to stay on top of your payments and avoid getting into debt!

Which one is more accurate: TransUnion or Equifax?

This answer is very simple: no credit report agency is more accurate than the other! Both provide different scoring models and are responsible for them!

Still, some mistakes can happen, and it is up to the consumer to track their credit report and ensure no mistakes.

Any error on your credit report can negatively impact your credit score. So if you identify any error, you can dispute it!

TransUnion and Equifax allow consumers to dispute any mistakes in their credit reports!

You can do it through their website, email, or by phone! Don’t hesitate if you need it!

Where can I check my credit score?

Focused african american businessman working with laptop documents in office
Discover how you can check your credit score! Source: AdobeStock

If you need to keep a close eye on your credit score and credit report, don’t worry. There are multiple ways you can do it online and for free!

For example, some credit cards provide free credit score monitoring services! Especially those that were designed to help customers build credit!

Also, you can access a free annual credit report from TransUnion and Equifax. You can request it at the AnnualCreditReport.com website.

In addition, some credit card monitoring services online will provide you with your credit score.

Bottom line

As you can see in our full article, TransUnion vs. Equifax are two different credit reporting agencies that use different scoring models.

As a result, you’ll have two different credit scores! But don’t worry; this won’t greatly impact your finances since you keep up with a good rate.

TransUnion and Equifax credit reports will provide reliable credit reports according to their scoring models.

But don’t forget to keep track of your credit score; after all, missed reports and errors can happen!

Next, learn if a 750 credit score is a good rating! We’ve provided the best tips for you! So keep reading and learn more!

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About the author  /  Luis Felipe Xavier

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