Your credit scores help reflect your creditworthiness, or how likely you are to pay back debts on time. The higher your scores, the better your estimated creditworthiness.
The three main consumer credit bureaus - Equifax, Experian and TransUnion - create your credit reports, which credit scoring models like VantageScore and FICO use to come up with scores that typically range from 300-850.
Your scores are typically based on credit factors like how often you make payments on time and how much of your available credit you use (also known as your credit utilization). Your scores will never factor in personal information like your race, gender, religion, marital status or national origin.
Credit scores are calculated based on information in your credit reports (like those from TransUnion,Equifax and Experian) according to specific scoring models (like VantageScore and FICO). For example, you can see your VantageScore 3.0 credit scores from TransUnion and Equifax on Credit Karma. Different scoring models can weigh your credit details differently. That’s one reason your scores can vary from model to model.
Lenders typically check your credit when you apply for financial products such as:
- A new credit card
- A personal loan
- A mortgage
Checking your credit will only lower your scores for a hard credit inquiry that you’ll need to authorize. A soft inquiry, like what happens when you check your VantageScore 3.0 credit scores from TransUnion and Equifax on Credit Karma, will not impact your scores. Read more about the difference between hard and soft credit inquiries here.