Talk:Credit score

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This article was the subject of a Wiki Education Foundation-supported course assignment, between 30 October 2018 and 11 December 2018. Further details are available on the course page. Student editor(s): Bunny233. Peer reviewers: Bunny233.

Above undated message substituted from Template:Dashboard.wikiedu.org assignment by PrimeBOT (talk) 18:37, 16 January 2022 (UTC)

Nothing about the history of scoring systems?

Good, bad, or neutral, unlike normal markets this system has not always existed. In fact, it seems to be an extremely recent development. There should be a history of the rise of credit agencies and scores. 96.240.128.124 (talk) 17:32, 19 December 2021 (UTC)

Let's see if I can do a "stream of consciousness" regarding the inclusion of history about consumer credit reporting bureaus and credit scoring:

• should be country-specific (my observations may be U.S.-specific)
• history of credit bureaus is fairly distinnct from history of credit scoring systems
  • (I note that credit bureau has a peculiar notion that "credit bureau" is distinct from "(consumer) credit reporting agency"
  • (Ha ha! Credit reporting agency and Credit reporting agencies redirect to different articles.)
  • (Neither of these seems to acknowledge that the "popular term" in the U.S. for the entities formerly known as "credit bureaus" is "credit reporting agencies" rather than "consumer reporting agencies". Reference: Credit Bureaus: The Record Keepers (St. Louis Fed)
• credit bureau history is largely a matter of consolidation of highly localized credit bureaus
• relationship (if any) between credit cards honored at selected local retailers (e.g. Washington Shopping Plate) and local credit bureaus (were such services independent of the participating stores or were they a true consortium?)
• credit scoring,as a mechanism to evaluate credit based entirely on a credit report is a much more recent development.
• credit scoring is generally attributed to Fair Isaac.
• Watch out for sources! Industry participants have their own point of view to push. (As an example, FICO makes a big deal out of the fact that the vast majority of lenders use a FICO score rather than a Vantage score, but overlook the fact that it's more likely than not that the credit scoring model used by any given lender will not match any particular FICO scoring model (e.g. you may be monitoring the Experian FICO 8 generic score, while the lender you have applied to may be using the TransUnion FICO 9 auto socre), making it somewhat dubious that monitoring any particular FICO score is particularly more helpful than monitoring any one of the current Vantage scores.
• new developments:
  • services like Boost, but number of consumers participating in such programs may be very limited
  • FICO presumably promoting a trend-based credit score
• See also: Credit score in the United States

Fabrickator (talk) 23:21, 19 December 2021 (UTC)

Why would credit karma take 64 points from my credit score without no explanation

Why would credit karma take 64 points from me without no explanation on my credit report. That's the lousiest thing you could do to someone during the Christmas holidays there's a big mistake somewhere 68.81.233.80 (talk) 21:25, 23 December 2021 (UTC)

Undoubtedly, Credit Karma has determined that you use non-standard English, and credit scores tend to discriminate against such persons. (While the credit industry disputes this, unbiased sources support this claim.) After you improve your English, it will take at least 6 months before your credit score reflects this, but after about 3 years, your credit score will recover to where it would have been if you had never used non-standard English. Fabrickator (talk) 00:31, 24 December 2021 (UTC)

Definitions of credit score

Credit scores are of multiple varieties. Some scores are built using credit bureau data, and those are generally referred to as "generic" or "pooled industry" scores. Examples are the FICO and Vantage scores in the US. There are also credit scorecards built internally by bankers and others. These are called "custom" or "internal" scorecards. While generic scores are built using data from the bureaus, internal scores can, and are built globally using a variety of data sources including from application forms, credit bureau, transactions from savings/chequing accounts, transactions from credit cards and newer "alternative" data sources such as social media, telco data and rental/utilities information. Scorecards are also defined by their usage : "application or originations" scorecards are used to grant new credit. "Behavioural" ones are used for ongoing risk management of existing customers. Depending on the country/regulations, typical variables used can include : Credit bureau : inquiries, trades, credit limits, delinquency history, age of trades Demographics : age, employment industry and time, home ownership, time at residence, postal code transactions : deposits, withdrawals, purchases, payments, delinquencies, where you shop Telco : payments, top ups, device information, apps NaeemSiddiqi (talk) 17:09, 27 February 2023 (UTC)

In its generic form, a "credit score" could be anything that any given credit grantor wants it to be, provided that the score is used provide some kind of rating or ranking of an applicant's credit.

However, in popular use, a credit score is something that's provided by a third party to credit grantors who are not using their own proprietary scoring system, and it is only in this context that the ordinary person is concerned about their credit score. It is certainly confusing enough that there are dozens of credit scores available from companies in the business of providing credit scores to credit grantors (in the United States alone), please do not confuse the issue by insisting that all the possible ways that may be used to rank a person's credit history are to be included in this definition of credit score. Fabrickator (talk) 06:53, 28 February 2023 (UTC)

Thats like saying "Google" is the same as searching when someone is trying to explain what a web search engine is. and lets not confuse people when there are Bing, Google, DuckDuckGo etc.

Banks in the US and globally use internally built credit scores to grant credit, in addition to the FICO score. I've trained hundreds of them in over 25 countries. Outside of the US, bureau scores like FICO are rare. To popularise a false notion doesnt benefit anyone. Explain what it is and assume that the end user can appreciate the nuance. "Credit Score" is not a replacement term for commercial models built by companies using credit bureau data. Fintechs are increasingly pushing the envelope, even in the US, and using diverse data sources. 2607:F798:804:F3:D980:8E49:E2D4:A6EF (talk) 15:56, 28 February 2023 (UTC)

By Country Section: India's all Credit bureaus are not completely described need to Explain it properly

{{Short description|Numerical expression representing a person's creditworthiness}}
{{About|an individual's financial credit score|organization's credit rating|credit rating|China's system for trustworthiness|Social Credit System}}
A '''credit score''' is a numerical expression based on a level analysis of a person's credit files, to represent the [[creditworthiness]] of an individual.<ref>{{Cite web|last=Kagan|first=Julia|title=Credit Score|url=https://www.investopedia.com/terms/c/credit_score.asp|url-status=live|access-date=2021-05-24|website=Investopedia|language=en|archive-url=https://web.archive.org/web/20071019043038/http://www.investopedia.com:80/terms/c/credit_score.asp |archive-date=2007-10-19 }}</ref> A credit score is primarily based on a [[credit report]], information typically sourced from [[credit bureau]]s.<ref>{{Cite web|date=2021-02-11|title=What Is a Good Credit Score?|url=https://www.experian.com/blogs/ask-experian/credit-education/score-basics/what-is-a-good-credit-score/|access-date=2021-05-24|website=www.experian.com|language=en-US}}</ref>

Lenders, such as [[bank]]s and credit card companies, use credit scores to evaluate the potential risk posed by lending money to consumers and to mitigate losses due to [[bad debt]]. Lenders use credit scores to determine who qualifies for a loan, at what [[interest rate]], and what credit limits.<ref>{{Cite web|title=What is a Credit Score – Credit Score Range {{!}} Equifax|url=https://www.equifax.com/personal/education/credit/score/what-is-a-credit-score/|access-date=2021-05-24|website=www.equifax.com}}</ref>  Lenders also use credit scores to determine which customers are likely to bring in the most revenue.

Credit scoring is not limited to banks. Other organizations, such as mobile phone companies, insurance companies, landlords, and government departments employ the same techniques. Digital finance companies such as online lenders also use alternative data sources to calculate the creditworthiness of borrowers.<ref>{{Cite web|last1=Experian|last2=Karma|first2=Credit|last3=Hero|first3=Student Loan|last4=Tretina|first4=more Learn about our editorial policies Kat|title=What Credit Score Do You Need to Buy a Car?|url=https://www.investopedia.com/what-credit-score-do-you-need-to-buy-a-car-5181034|access-date=2021-05-24|website=Investopedia|language=en}}</ref><ref>{{Cite web|last=Kagan, Julia|title=Insurance Score|url=https://www.investopedia.com/terms/i/insurancescore.asp|url-status=live|access-date=2021-05-24|website=Investopedia|language=en|archive-url=https://web.archive.org/web/20060317063805/http://www.investopedia.com/terms/i/insurancescore.asp |archive-date=2006-03-17 }}</ref>

==By country==

===Australia===

In Australia, credit scoring is widely accepted as the primary method of assessing creditworthiness. Credit scoring is used not only to determine whether credit should be approved to an applicant, but for credit scoring in the setting of credit limits on credit or store cards, in behavioral modelling such as collections scoring, and also in the pre-approval of additional credit to a company's existing client base.

Although [[logistic function|logistic]] (or [[non-linear]]) probability modelling is still the most popular means by which to develop scorecards, various other methods offer powerful alternatives, including [[Multivariate adaptive regression splines|MARS]], [[Predictive analytics#Classification and regression trees|CART]], [[CHAID]], and [[random forest]]s.

Prior to 12 March 2014 [[Veda Advantage]], the main provider of credit file data, provided only a negative credit reporting system containing information on applications for credit and adverse listings indicating a default under a credit contract. Veda was acquired by Equifax in Feb 2016, making Equifax the largest credit agency in Australia.<ref>{{cite web|url=https://www.alrc.gov.au/publications/52.%20Overview%3A%20Credit%20Reporting/credit-reporting-agencies|title=Credit reporting agencies|last=Anonymous|date=17 August 2010|language=en|access-date=6 March 2018}}</ref>

With the subsequent introduction of positive reporting, lending companies have begun an uptake of its usage with some implementing [[Risk-based pricing|risk based pricing]] to set lending rates.{{citation needed|date=April 2020}}

===Austria===
In [[Austria]], credit scoring is done as a blacklist. Consumers who did not pay bills end up on the blacklists that are held by different [[credit bureau]]s.<ref>{{cite web |url=http://www.ksv.at/KSV/1870/de/4privatpersonen/4fragenantworten/index.html |title=Fragen & Antworten |access-date=31 March 2011 |url-status=dead |archive-url=https://web.archive.org/web/20110101180603/http://www.ksv.at/KSV/1870/de/4privatpersonen/4fragenantworten/index.html |archive-date=1 January 2011 }}</ref> Having an entry on the black list may result in the denial of contracts. Certain enterprises including telecom carriers use the list on a regular basis. Banks also use these lists, but rather inquire about security and income when considering loans. Beside these lists several agencies and credit bureaus provide credit scoring of consumers.

According to the [[Data Protection Directive|Austrian Data Protection Act]], consumers must opt-in for the use of their private data for any purpose. Consumers can also withhold permission to use the data later, making illegal any further distribution or use of the collected data.<ref>§ 8 Abs 1 Z2 DSG</ref> Consumers also have the right to receive a free copy of all data held by credit bureaus once a year.<ref>§ 26 DSG</ref> Wrong or unlawfully collected data must be deleted or corrected.<ref>§§ 27 and 28 DSG</ref>

===Brazil===
Credit scoring is relatively new in Brazil. Previously, credit reporting was done as a blacklist and each lender used to assess potential borrowers on their own criteria. Nowadays, the system of credit reports and scores in Brazil is very similar to that in the United States.

A credit score is a number based on a statistical analysis of a person's credit information, which represents the creditworthiness of that person. It is the most important tool used by financial institutions during a credit analysis that aims to assist the decision-making process of granting credit and conducting business, in order to verify the likelihood that people will pay their bills. A credit score is primarily based on credit report information, typically from one of the three major credit bureaus: [[Experian|Serasa Experian]], [[:pt:Boa Vista Serviços|Boa Vista]] (previously [[Equifax|Equifax do Brasil]]) and [[:pt:Serviço de proteção ao crédito|SPC Brasil]].{{citation needed|date=April 2020}}

There are different methods of calculating credit scores in Brazil. In general, scores range from 0 to 1000 indicating what is the chance of a certain profile of consumers paying their bills on time in the next 12 months. The score is calculated from several factors, but practically it analyzes a person's trajectory as a consumer, what includes up to date payments of bills, history of negative debts, financial relationships with companies and updated personal data on credit protection agencies, such as Serasa Experian, Boa Vista, SPC, Quod and Foregon.<ref>{{Cite web |url=https://www.serasaconsumidor.com.br/ensina/ver-o-score-e-gratis/ |title=Tudo sobre score de crédito |language=es |trans-title=All about credit score |access-date=29 May 2019 |archive-url=https://web.archive.org/web/20190529030645/https://www.serasaconsumidor.com.br/ensina/ver-o-score-e-gratis/ |archive-date=29 May 2019 |url-status=dead }}</ref><ref>{{cite web|url=https://quickbooks.intuit.com/br/blog/conceitos-financas/entenda-como-funciona-o-score-de-credito-do-consumidor|title=Entenda Como Funciona o Score de Crédito do Consumidor|date=24 April 2015|website=QuickBooks}}</ref>

===Canada===
The system of credit reports and scores in Canada is very similar to that in the United States and India, with two of the same reporting agencies active in the country:  [[Equifax]] and [[TransUnion]]. ([[Experian]], which entered the Canadian market with the purchase of Northern Credit Bureaus in 2008, announced the closing of its Canadian operations as of 18 April 2009).

There are, however, some key differences. One is that, unlike in the United States, where a consumer is allowed only one free copy of their credit report a year, in Canada, the consumer may order a free copy of their credit report any number of times in a year, as long as the request is made in writing, and as long as the consumer asks for a printed copy to be delivered by mail.<ref>[https://www.theglobeandmail.com/globe-investor/personal-finance/household-finances/its-easy-to-get-a-free-credit-report-honest/article620190/ TransUnion form] (Canada)</ref> Borrowell and CreditKarma offers free credit report and credit check and this request by the consumer is noted in the credit report as a 'soft inquiry', so it has no effect on their credit score. According to Equifax's ScorePower Report, Equifax Beacon scores range from 300 to 900. Trans Union Emperica scores also range from 300 to 900.

The [[Government of Canada]] offers a free publication called ''Understanding Your Credit Report and Credit Score''.<ref>[http://www.fcac-acfc.gc.ca/eng/resources/publications/creditLoans/Pages/Understa-Comprend.aspx Understanding Your Credit Report and Credit Score] (Canada)</ref>  This publication provides sample credit report and credit score documents, with explanations of the notations and codes that are used. It also contains general information on how to build or improve credit history, and how to check for signs that [[identity theft]] has occurred. The publication is available online at the [[Financial Consumer Agency of Canada]]. Paper copies can also be ordered at no charge for residents of Canada.

===China===
{{See also|Social Credit System}}

Private companies have developed credit score systems such as [[Sesame Credit]] (which is provided by Alibaba affiliate Ant Financial)<ref>{{cite web|url=https://www.cnbc.com/2017/03/16/china-social-credit-system-ant-financials-sesame-credit-and-others-give-scores-that-go-beyond-fico.html|title=FICO with Chinese characteristics: Nice rewards, but punishing penalties|last=Ming|first=Cheang|date=2017|website=CNBC}}</ref> and [[Tencent|Tencent Credit]].

===Denmark===
The credit scoring is widely used in Denmark by the banks and a number of private companies within telco and others. The credit scoring is split in two:
* Private: The probability of defaulting
* Businesses: The probability of bankruptcy
For privates, the credit scoring is always made by the creditor. For businesses it is either made by the creditor or by a third party. A business credit score is a direct representation of a company's creditworthiness.

There are a few companies who have specialized in developing credit scorecards in Denmark:
* [[Experian]] (generic rating for business)
* [[Bisnode]] (generic rating for business)

The credit scorecards in Denmark are mainly based on information provided by the applicant and publicly available data. It is very restricted by legislation compared to its neighbouring countries.{{Citation needed|date=May 2021}}

===Germany===

In Germany, credit scoring is widely accepted as the primary method of assessing creditworthiness. Credit scoring is used not only to determine whether credit should be approved to an applicant, but for credit scoring in the setting of credit limits on credit or store cards, in behavioral modelling such as collections scoring, and also in the pre-approval of additional credit to a company's existing client base.

Consumers have the right to receive a free copy of all data held by credit bureaus once a year. At present [[Schufa]], the main provider of credit file data, provides scores for about three-quarters of the German population.<ref>{{cite web|url=https://fahrplan.events.ccc.de/congress/2018/Fahrplan/events/9343.html|title=Lecture: Court in the Akten | Sunday | Schedule 35th Chaos Communication Congress|website=fahrplan.events.ccc.de}}</ref>

===India===
[[India]] has several credit bureaus that play a crucial role in the country's financial ecosystem. There are four credit information companies licensed by [[Reserve Bank of India]]. The Credit Information Bureau (India) Limited ([[CIBIL]]) has functioned as a Credit Information Company from January 2001.<ref name="Reserve Bank of India">{{cite web|url=http://www.rbi.org.in/scripts/NotificationUser.aspx?Id=5540&Mode=0|title=Reserve Bank of India|website=rbi.org.in}}</ref> Subsequently, in 2010, [[Experian]],<ref name="Reserve Bank of India"/> [[Equifax]]<ref>{{cite web|url=http://www.rbi.org.in/scripts/NotificationUser.aspx?Id=5598&Mode=0|title=Reserve Bank of India|website=rbi.org.in}}</ref> and [[CRIF High Mark Credit Information Services|CRIF High Mark]]<ref>{{cite web|url=http://www.rbi.org.in/scripts/NotificationUser.aspx?Id=6137&Mode=0|title=Reserve Bank of India|website=rbi.org.in}}</ref> were given licenses by [[Reserve Bank of India]] to operate as Credit Information Companies in India. These credit bureaus collect and maintain credit information on individuals and businesses, which is used by lenders and financial institutions to assess creditworthiness when making lending decisions.<ref>{{cite web|url=https://www.etmoney.com/learn/loans/credit-bureaus-in-india/|title= What Are Credit Bureaus I India|website=etmoney.com}}</ref> 

Although all the four credit information companies have developed their individual credit scores, the most popular is [[CIBIL]] credit score. The [[CIBIL]] credit score is a three  digit number that represents a summary of individuals' credit history and credit rating. This score ranges from 300 to 900, with 900 being the best score. Individuals with no credit history will have a score of −1. If the credit history is less than six months, the score will be 0. [[CIBIL]] credit score takes time to build up and usually it takes between 18 and 36 months or more of credit usage to obtain a satisfactory credit score.

Experian stands out as one of the leading credit bureaus active in India. It specializes in gathering credit-related information from a wide array of sources, utilizing this data to create comprehensive credit reports and scores. This score ranges from 300 to 850.<ref>{{cite web|url=https://www.experian.com/blogs/ask-experian/infographic-what-are-the-different-scoring-ranges/|title= Experian Credit Scoring Ranges|website=experian.com}}</ref> Experian's credit reports offer a thorough and detailed look into an individual's credit history, while the credit score serves as a reliable indicator of their overall creditworthiness. Beyond this, Experian extends its services to include valuable tools such as fraud detection, identity verification solutions, and advanced analytics, all designed to provide crucial support to businesses in their efforts to effectively manage credit risk.

Equifax India is another global credit bureau that operates in India also. It gathers credit data from different sources and compiles anf offers credit reports and scores to assist lenders in making informed lending decisions. Equifax credit score ranges from 300-900. Credit Score taht ranges between 580 to 669 are considered fair; 670 to 739 are considered good; 740 to 799 are considered very good; and 800 and up are considered excellent. Additionally, it provides businesses with risk management solutions and fraud prevention services to help them proactively reduce and manage credit-related risks.<ref>{{cite web|url=https://www.newindianexpress.com/express-connect/2023/may/24/credit-bureaus-in-india-what-is-their-role-and-how-do-they-work-2578207.html|title= Role of Credit bureaus in India|website=newindianexpress.com}}</ref>

CRIF High Mark is a leading credit bureau that provides comprehensive credit information and risk management solutions to individuals and businesses in India. Its credit reports provide detailed insights into an individual’s credit history, while the credit score represents their creditworthiness.
CRIF High Mark credit score ranges from 300-900. 300 is the lowest and 900 is the highest possible score.

===Norway===
In [[Norway]], credit scoring services are provided by three credit scoring agencies: [[Dun & Bradstreet]], [[Experian]] and Lindorff Decision. Credit scoring is based on publicly available information such as demographic data, tax returns, taxable income and any ''Betalingsanmerkning'' (non-payment records) that might be registered on the credit-scored individual. Upon being scored, an individual will receive a notice (written or by e-mail) from the scoring agency stating who performed the credit score as well as any information provided in the score. In addition, many credit institutions use custom scorecards based on any number of parameters. Credit scores range between 300 and 999.{{Citation needed|date=May 2021}}

===Republic of Ireland===

In the [[Republic of Ireland]], a person's credit score is calculated by the Irish Credit Bureau (ICB), a private organisation, financed by its members (financial institutions and local authorities). A person taking out a loan must consent to their data being given to the ICB.<ref name="auto">{{Cite web|url=https://www.citizensinformation.ie/en/money_and_tax/personal_finance/loans_and_credit/your_credit_history.html#|title=Your credit history|website=www.citizensinformation.ie}}</ref> A person may receive their own credit report on paying a €6 fee to the ICB.<ref>{{Cite web|url=https://www.irishmirror.ie/lifestyle/homes-and-property/what-your-credit-rating-what-12634342|title=What is your credit rating and what does it mean?|first=Stephen|last=McMullin|date=June 5, 2018|website=Irish Mirror}}</ref> Credit scores run from 224 (the worst value) to 581 (the best value).<ref>{{Cite web|url=https://blog.bankofireland.com/check-your-credit-rating/|title=Check and improve your credit rating|date=September 6, 2020}}</ref>

There is also a separate Central Credit Register (CCR) maintained by the [[Central Bank of Ireland]], founded in 2017 under the terms of the [[Credit Reporting Act 2013]]. The lender must check the CCR if a person is borrowing more than €2,000, and can also check it if the loan is lower; consent from the borrower is not required.<ref name="auto"/><ref>{{Cite web|url=https://www.moneyguideireland.com/how-to-check-your-credit-rating-in-ireland.html|title=How to Check Your Credit Rating in Ireland|date=June 14, 2020}}</ref>

Information is removed from both registers (ICB and CCR) five years after the loan is repaid.<ref name="auto"/>

===South Africa===
Credit scoring is used throughout the credit industry in [[South Africa]], with the likes of banks, micro-lenders, clothing retailers, furniture retailers, specialized lenders and insurers all using credit scores.  Currently all four retail [[credit bureau]] offer credit bureau scores.  The data stored by the credit bureaus include both positive and negative data, increasing the predictive power of the individual scores.  [[TransUnion]] (formerly ITC) offer the Empirica Score which is, as of mid-2010, in its 4th generation.  The Empirica score is segmented into two suites: the account origination (AO) and account management (AM).  [[Experian]] South Africa likewise has a Delphi credit score with their fourth generation about to be released (late 2010). In 2011, [[Compuscan]] released Compuscore ABC, a scoring suite which predicts the probability of customer default throughout the credit life cycle. Six years later, Compuscan introduced Compuscore PSY, a 3-digit psychometric-based credit bureau score used by lenders to make informed lending decisions on thin files or marginal declines.<ref>{{cite web|url=https://www.compuscan.co.za/introducing-newest-service-offering-compuscore-psy/|title=Introducing our newest service offering: Compuscore PSY|archive-url=https://web.archive.org/web/20171211213921/https://www.compuscan.co.za/introducing-newest-service-offering-compuscore-psy/|archive-date=11 December 2017|url-status=dead|access-date=11 December 2017}}</ref>

===Sri Lanka===
According to the provisions of Credit Information Bureau Act No 18 of 1990 (as amended by Act No 42 of 2008), [[Credit Information Bureau, Inc.|CRIB]] has been delegated with power to issue credit reports to any subject to whom that information is related to. The Bureau commenced to issue Self Inquiry Credit Reports in December 2009.<ref>[http://www.crib.lk/en/index.php/customer-help-desk/obtain-your-own-credit-report Crib.lk] (Sri Lanks)</ref>

=== Sweden ===
Sweden has a system for credit scoring that aims to find people with a history of neglect to pay bills or, most commonly, taxes. Anyone who does not pay their debts on time, and fails to make payments after a reminder, will have their case forwarded to the Swedish [[Enforcement Authority]] which is a national authority for collecting debts. The mere appearance of a company, or government office, as a debtor to this authority will result in a record among private credit bureaus; however, this does not apply to individuals as debtors. This record is called a ''Betalningsanmärkning'' (non-payment record) and by law can be stored for three years for an individual and five years for a company.<ref>{{cite web|title=Betalningsanmärkning|url=https://www.kronofogden.se/Betalningsanmarkning2.html|website=kronofogden.se|publisher=[[Enforcement Authority]]|access-date=16 August 2015}}</ref> This kind of nonpayment record will make it very difficult to get a loan, rent an apartment, get telephone subscriptions, rent a car or get a job where you handle cash. The banks also use income and asset figures in connection with loan assessments.<ref>{{cite web|last1=Liljemalm|first1=Anna|title=Så minskar skulder chansen att få lägenhet|trans-title=Debts reduce chances to get an apartment|url=http://www.gp.se/ekonomi/1.2618214-sa-minskar-skulder-chansen-att-fa-lagenhet|website=gp.se|publisher=[[Göteborgs-Posten]]|date=3 February 2015|access-date=16 August 2015}}</ref>

If a person gets an injunction to pay issued by the Enforcement Authority, it is possible to dispute it. Then the party requesting the payment must show its correctness in district court. Failure to dispute is seen as admitting the debt. If the debtor loses the court trial, costs for the trial are added to the debt. Taxes and authority fees must always be paid on demand unless payment has already been made.

Every person with a Swedish [[national identification number]] must register a valid address, even if living abroad, since sent letters are considered to have been delivered to that person once they reach the registered address. As an example, Swedish astronaut [[Christer Fuglesang]] got a ''Betalningsanmärkning'' since a car he had ordered, and therefore owned, passed a toll station for the [[Stockholm congestion tax]]. At the time, he was living in the USA training for his first [[STS-116|Space Shuttle mission]] and had an old invalid address registered for the car. Letters with payment requests did not reach him on time. The case was appealed and retracted, but the non-payment record remained for three years since it could not be retracted according to the law.<ref>{{cite web|last1=Olsson|first1=Caroline|title=Fuglesang hamnar hos kronofogden|trans-title=Fuglesang at the Swedish Enforcement Administration|url=http://www.aftonbladet.se/nyheter/article11372512.ab|website=aftonbladet.se|publisher=[[Aftonbladet]]|date=17 March 2008|access-date=16 August 2015}}</ref>

===United Kingdom===
{{See also|Credit scorecards}}
Credit scoring in the United Kingdom is very different to that of the United States and other nations. There is no such thing as a universal credit score or credit rating in the UK. Each lender will assess potential borrowers on their own criteria, and these algorithms are effectively trade secrets.

"Credit scores" which are available for individuals to see and provided from [[Credit Reference Agencies]] such as Call Credit, [[Equifax]], [[Experian]]<ref>{{cite web|url=https://www.thestreet.com/video/heres-what-your-credit-score-is-according-to-an-experian-executive-14819049|title=Here's What Your Credit Score Is According to an Experian Executive|first=Katherine|last=Ross|date=27 December 2018|website=TheStreet}}</ref> and [[TransUnion]] are marketed to consumers and are not usually used by lenders. Most lenders instead use their own internal scoring mechanism.{{Citation needed|date=January 2019}}

The most popular statistical technique used is [[logistic regression]] to predict a binary outcome: bad debt (meaning the borrower has defaulted on the loan) or not.<ref>{{cite thesis |last1=Tabagari |first1=Salome |title=Credit scoring by logistic regression |date=2015-05-13 |url=https://core.ac.uk/download/pdf/79110695.pdf |access-date=2021-05-22 |publisher=University of Tartu}}</ref> Some banks also build regression models that predict the amount of bad debt a customer may incur. Typically this is much harder to predict, and most banks focus only on the binary outcome.

Credit scoring is closely regulated only by the [[Financial Conduct Authority]] when used for the purposes of the Advanced approach to Capital Adequacy under [[Basel II]] regulations.

Credit scoring is closely regulated in the UK, with the industry regulator being the [[Information Commissioner's Office]] (ICO). Consumers can also send complaints to the [[Financial Ombudsman Service]] if they experience problems with any Credit Reference Agency.<ref>{{cite web |last1=Hulland |first1=Louise |title=Credit Reference Agencies |url=http://www.bbc.co.uk/programmes/b006mg74/features/credit-reference-agency |website=[[BBC One]] |access-date=2021-05-22 |archive-url=https://web.archive.org/web/20140301121930/http://www.bbc.co.uk/programmes/b006mg74/features/credit-reference-agency |archive-date=2014-03-01 |date=2013-10-03 |url-status=dead }}</ref>

It is very difficult for a consumer to know in advance whether they have a high enough credit score to be accepted for credit with a given lender.  This situation is due to the complexity and structure of credit scoring, which differs from one lender to another.

Lenders need not reveal their credit score head, nor need they reveal the minimum credit score required for the applicant to be accepted, because there may not be such a minimum score.

If the applicant is declined for credit, the lender is not obliged to reveal the exact reason why. However industry associations including the [[Finance and Leasing Association]] oblige their members to provide a satisfactory reason. Credit-bureau data sharing agreements also require that an applicant declined based on credit-bureau data be told that this is the reason and the address of the credit bureau must be provided.

===United States===
{{Main|Credit score in the United States}}
{{Also|Criticism of credit scoring systems in the United States}}
In the United States, a credit score is a number based on a statistical analysis of a person's credit files, that in theory represents the [[creditworthiness]] of that person, which is the likelihood that people will pay their bills.  A credit score is primarily based on [[credit report]] information, typically from one of the three major [[credit bureau]]s: [[Experian]], [[TransUnion]], and [[Equifax]]. Income and employment history (or lack thereof) are not considered by the major credit bureaus when calculating credit scores.

There are different methods of calculating credit scores. [[FICO score]]s, the most widely used type of credit score, is a credit score developed by [[FICO]], previously known as [[Fair Isaac|Fair Isaac Corporation]].  As of 2018, there were 29 different versions of FICO scores in use in the United States. Some of these versions are "industry specific" scores, that is, scores produced for particular market segments, including automotive lending and bankcard (credit card) lending. Industry-specific FICO scores produced for automotive lending are formulated differently than FICO scores produced for bankcard lending. Nearly every consumer will have different FICO scores depending upon which type of FICO score is ordered by a lender; for example, a consumer with several paid-in-full car loans but no reported credit card payment history will generally score better on a FICO automotive-enhanced score than on a FICO bankcard-enhanced score. FICO also produces several "general purpose" scores which are not tailored to any particular industry. Industry-specific FICO scores range from 250 to 900, whereas general purpose scores range from 300 to 850.

FICO scores are used by many mortgage lenders that use a risk-based system to determine the possibility that the borrower may default on financial obligations to the mortgage lender. For most mortgages originated in the United States, three credit scores are obtained on a consumer: a Beacon 5.0 score (Beacon is a trademark of FICO) which is calculated from the consumer's Equifax credit history, a FICO Model II score, which is calculated from the consumer's Experian credit history, and a Classic04 score, which is calculated from the consumer's Trans Union history.

[[Credit bureau]]s also often re-sell FICO scores directly to consumers, often a general-purpose FICO 8 score. Previously, the credit bureaus also sold their own credit scores which they developed themselves, and which did not require payment to FICO to utilize: [[Equifax]]'s RISK score and [[Experian]]'s PLUS score. However, as of 2018, these scores are no longer sold by the credit bureaus. Trans Union offers a Vantage 3.0 score for sale to consumers, which is a version of the [[VantageScore]] credit score. In addition, many large lenders, including the major credit card issuers, have developed their own proprietary scoring models.

Studies have shown scores to be predictive of risk in the underwriting of both credit and insurance.<ref>[http://www.federalreserve.gov/boarddocs/RptCongress/creditscore/creditscore.pdf Report to the Congress on credit scoring and its effects on the availability and affordability of credit]</ref><ref name=insurance>[http://www2.ftc.gov/os/2007/07/P044804FACTA_Report_Credit-Based_Insurance_Scores.pdf Credit-based insurance scores: Impacts on consumers of automobile insurance] {{webarchive|url=https://web.archive.org/web/20090511204147/http://ftc.gov/os/2007/07/P044804FACTA_Report_Credit-Based_Insurance_Scores.pdf |date=11 May 2009 }}</ref><ref>{{cite web|url=http://www.iii.org/media/presentations/creditscoringtexas/|title=No Evidence of Disparate Impact in Texas Due to Use of Credit Information by Personal Lines Insurers – III|website=iii.org}}</ref>  Some studies even suggest that most consumers are the beneficiaries of lower credit costs and insurance premiums due to the use of credit scores.<ref name=insurance/><ref>[http://www.federalreserve.gov/pubs/bulletin/2003/0203lead.pdf An overview of consumer data and credit reporting]</ref>

Usage of credit histories in employment screenings increased from 19% in 1996 to 42% in 2006.<ref name=wernau>{{cite news|last=Wernau|first=Julie|title=TransUnion battling attempts to ban employment credit checks|url=http://articles.chicagotribune.com/2010-04-28/business/ct-biz-0429-credit-checks-transunion--20100428_1_credit-checks-transunion-credit-bureaus|access-date=23 October 2011|newspaper=Chicago Tribune|date=28 April 2010}}</ref>{{rp|1}}  However, credit reports for employment screening purposes do not include credit scores.<ref name=wernau />{{rp|2}}

Americans are entitled to one free credit report in every 12-month period from each of the three credit bureaus, but are not entitled to receive a free credit score. The three credit bureaus run [[Annualcreditreport.com]], where users can get their free credit reports. Credit scores are available as an add-on feature of the report for a fee. If the consumer disputes an item on a credit report obtained using the free system, under the [[Fair Credit Reporting Act]] (FCRA), the credit bureaus have 45 days to investigate, rather than 30 days for reports obtained otherwise.

Alternatively, consumers wishing to obtain their credit scores can in some cases purchase them separately from the credit bureaus or can purchase their FICO score directly from [[FICO]]. Credit scores (including FICO scores) are also made available free by subscription to one of the many [[credit report monitoring]] services available from the credit bureaus or other third parties, although to actually get the scores free from most such services, one must use a credit card to sign up for a free trial subscription of the service and then cancel before the first monthly charge. Websites like [[WalletHub]], [[Credit Sesame]] and [[Credit Karma]] provide free credit scores with no credit card required, using the [[TransUnion]] VantageScore 3.0 model. Credit.com uses the [[Experian]] VantageScore 3.0 model. Until March 2009, holders of credit cards issued by [[Washington Mutual]] were offered a free FICO score each month through the bank's Web site. ([[Chase (bank)|Chase]], which took over Washington Mutual in 2008, discontinued this practice in March 2009.)<ref>[http://www.bankrate.com/brm/news/cc/credit-card-update.asp Chase drops WaMu secured card, FICO score] retrieved on 17 January 2009</ref> [[Chase (bank)|Chase]] resumed the practice of offering a free FICO score in March 2010 of select card members to the exclusion of the majority of former WAMU card holders.

Under the [[Fair Credit Reporting Act]], a consumer is entitled to a free credit report (but not a free credit score) within 60 days of any adverse action (e.g., being denied credit, or receiving substandard credit terms from a lender) taken as a result of their credit score. Under the [[Wall Street reform]] bill passed on 22 July 2010, a consumer is entitled to receive a free credit score if they are denied a loan or insurance due to their credit score.<ref>[https://obamawhitehouse.archives.gov/blog/2010/07/15/president-obama-final-passage-wall-street-reform-end-bailouts-a-beginning-accountabi President Obama on Final Passage of Wall Street Reform: An End to Bailouts, a Beginning for Accountability] published 15 July 2010, retrieved on 26 July 2010.</ref>

In the United States, the [[median]] generic FICO score was 723 in 2006<ref>{{cite news |last1=Harney |first1=Kenneth R. |title=New Mortgages Worry Regulators |url=https://www.washingtonpost.com/wp-dyn/content/article/2006/06/09/AR2006060900027.html |access-date=September 2, 2020 |date=June 9, 2006 |newspaper=[[The Washington Post]]}}</ref> and 711 in 2011.<ref>{{cite web |last1=Huynh |first1=Frederic |title=US Credit Quality Continues to Inch Forward |url=https://www.fico.com/blogs/us-credit-quality-continues-inch-forward |website=FICO /blog |publisher=[[FICO|Fair Isaac Corporation]] |access-date=September 2, 2020 |date=February 3, 2014}}</ref>  The performance definition of the FICO risk score (its stated design objective) is to predict the likelihood that a consumer will go 90 days past due or worse in the subsequent 24 months after the score has been calculated.  The higher the consumer's score, the less likely he or she will go 90 days past due in the subsequent 24 months after the score has been calculated.  Because different lending uses (mortgage, automobile, credit card) have different parameters, FICO algorithms are adjusted according to the predictability of that use.  For this reason, a person might have a higher credit score for a revolving credit card debt when compared to a mortgage credit score taken at the same point in time.

== See also ==

* [[Alternative data]]
* [[Bank statement]]
* [[Credit bureau]]
* [[Credit history]]
* [[Credit reference]]
* [[Credit scorecards]]
== References ==
{{Reflist}}

==External links==
* {{cite web|url=http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre24.shtm|title=FTC Guide to Credit Scores|date=25 May 2021}}
* {{cite web|title=Credit Scores Video – Federal Trade Commission|website = [[YouTube]]|url=https://www.youtube.com/watch?v=iliZgmqgRRE |archive-url=https://ghostarchive.org/varchive/youtube/20211219/iliZgmqgRRE |archive-date=2021-12-19 |url-status=live}}{{cbignore}}
* {{cite web|url=http://www.fcac.gc.ca|title=Financial Consumer Agency of Canada}}
* {{cite web|url=http://money.howstuffworks.com/credit-score.htm|title=How Credit Scores Work|date=16 July 2002}}
* {{cite journal|url=https://www.clevelandfed.org/en/newsroom-and-events/publications/economic-commentary/economic-commentary-archives/2010-economic-commentaries/ec-201016-your-credit-score-is-a-ranking-not-a-score.aspx|title=Your Credit Score Is a Ranking, Not a Score|journal=Economic Commentary|date=16 November 2010|issue=2010–16|last1=Demyanyk|first1=Yuliya}}

{{Authority control}}

{{DEFAULTSORT:Credit Score}}
[[Category:Credit scoring| ]]
[[Category:Personal finance]]

Mayank 945 (talk) 09:33, 9 September 2023 (UTC)

 Not done: please provide reliable sources that support the change you want to be made. Certain changes are not supported by reliable sources and/or are unsourced. — Paper9oll (🔔 • 📝) 11:42, 9 September 2023 (UTC)

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and my uncestours telling me last weak get moolato make it so it not free but maybe 2000 buying my salary iknow howtobuy foodonylyou know foodosexpencivebut ireak need moolaigoyeven sangomatot moolabut fanancial bad because if milking me sangomaabd gangs. So don't allow them.ism.waitng fooola I need to try borough money. Font all anyone iwill telling you now Igot my tv 41.116.42.47 (talk) 11:15, 10 September 2023 (UTC)

everyone got moolaboy and her babamamagot it first abdbossgot it first me mugnet money to make a lot of credit the media and gsngstonot. Have TV they block even network to talking with those gommahelp me. Media and sangomatot houwto man's and share to them. 41.116.42.47 (talk) 11:17, 10 September 2023 (UTC)

Scope

The scope of this article is very similar to that of the Credit scorecards article. In terms if the contents they differ quite a lot:

Credit score

• Overview
• Credit scores by country

Credit scorecards

• Overview
• Statistical techniques used for scoring
• Types of scorecards
• Traditional vs modern approch

What about renaming this article into Credit scores by country? The overview would need to be trimmed and all the content would go to Credit scorecards. Maybe even let's rename it to Credit scoring as 'scorecards' sounds a bit antiquated. To summarise:

Renaming

1. Credit score -> Credit scores by country
2. Credit scorecards -> Credit scoring

Redirects

1. Credit score -> Credit scoring

Alaexis_¿question? 14:25, 22 September 2023 (UTC)

Semi-protected edit request on 23 October 2023

Reference number 14 is out of date, change to: https://www.canada.ca/en/financial-consumer-agency/services/credit-reports-score/understand-credit-report.html Nik282000 (talk) 22:48, 23 October 2023 (UTC)

 Done PianoDan (talk) 21:21, 24 October 2023 (UTC)

Credit score and Sweden

When I look into the section about Sweden, I notice that most of the text is about "Betalningsanmärkning". But if you look into any record from UC and similair they contains much much more. You will see a list of the taxed income and taxes the last years. You see the martial status and if there is any "äktenskapsförord". You see if you are a subject of legal guardianship, at least if you have lost your legal ability, that is förvaltarskap. You see if you own any real estate. You also see a summary of your debts, from credit institutes that give out such information.

So, in summary, there is much much more information than you can get from the Swedish Enforcement Authority. Sometimes UC and their competitors gives you a credit score based on these data. How it looks like depends on the company. One example I have seen is "< 1 % risk of not being able to pay his/her debts". Smitingen (talk) 10:35, 13 November 2023 (UTC)

What are Credit Scores LIKE ?

I have not found a description of the actual Credit Scores, except in some cases by implication. For each country covered, a reader should be told what to expect the response to be like on asking for a Credit Score.

Will it be alphabetic, and if so in what character set - A-K, z-q, (for Greece) β-ζ / Σ-Δ, etc.?

Will it be numeric, and if so what is the possible range?

For those cases, which end of the range is good & which is bad?

Or is it given as a single word, as favoured by (IIRC) Ofsted?

Or what??

94.30.84.71 (talk) 11:53, 17 December 2023 (UTC)