Understanding Credit Score Differences

Understanding Credit Score Differences

There are few numbers in life that matter as much to your financial outlook and well-being as your credit score. However, confusion is the norm for consumers when it comes to this important financial gauge.

The History of Credit Scores

Prior to the creation of standardized credit scores, lenders and loan officers would often develop their own "score card" to assess the risk of lending to a particular borrower. This score card could vary drastically from one lender to the next. The major issue with this original method was that it was based on a loan officer's ability to judge risk, rather than a common set of rules and specific calculations.

So, in the 1980's, the Fair Isaac Corporation set up the first general purpose credit scoring system based on credit bureau information in order to help remove the inherent inconsistencies that arose from having each lender perform their own credit diagnostics. It has since become known as the FICO score and the algorithm has been widely adopted by America's largest credit reporting agencies.

Why would my score differ between credit agencies?

The three major credit bureaus are Equifax, Experian and TransUnion. If you're seeing different scores from each bureau, there could be a few reasons for this. Here are some of the most common ones.

  1. The scores are from different dates. Since your score can change at any time, it's important to compare credit scores from the same date.
  2. The scores were calculated using different scoring models. We'll get into this in the next section, but it's important to know that there are many scoring models out there. When you compare scores among bureaus, make sure they are calculated using the same model. Even with the same model, your scores could vary because each bureau may store information or calculate the score a little differently.
  3. The information in your credit reports varies among credit bureaus. This actually isn't uncommon. Some lenders report to all three credit bureaus, but others report to just two or one or none at all. The information in your credit reports may also be updated at different times at each bureau. In other words, one credit bureau may be missing an account or other information that either helps or hinders your score.

Of course, it's also a good idea to check your credit reports for errors periodically since an error could affect your score. You can check your TransUnion and Equifax credit reports for free on Credit Karma and your Experian report on www.AnnualCreditReport.com.

Why would my score differ between the same credit agency?

Like a thumbprint, no credit score model is exactly the same. Each credit score model has a slightly different formula for weighing credit score factors. The credit bureau can use dozens of different credit score models based on the requirements of different lenders. As an example, a mortgage lender may use a different scoring model than an auto lender because they each place importance on different factors.

Though your scores may vary, they're all based on information in your credit reports. So focusing on what's in your reports could help you build your credit overall.

Other Available Scores

While FICO is the most famous, there are several other versions and providers of credit scores, such as VantageScore, NextGen, BEACON and EMPIRICA. Some scores are directly developed by credit bureaus, while others are developed by outside companies.

Is there a "best score"?

In a word, no. In order to protect revenues, credit reporting agencies will often position their scores as the best or the most predictive. In reality, all scores must adhere to similar guidelines to be truly predictive, regardless of the final output number. All credit scores are built from the same base set of data and statistical procedures.

Like many products and services in the marketplace, there are a plethora of different options for you (and the businesses that serve you) to choose from, simply because every buyer is different. Based on cost and effectiveness in each buying situation, there are credit scores for sale to satisfy each customer.

Score Ranges

Just as a point of reference, it may be important for you to know what the score ranges are for each of the major scoring systems. The higher your score the better, as it is a general gauge of your overall creditworthiness in the eyes of lenders.

  • FICO Score: 300 -850
  • Score from Experian: 330-830
  • Score from Equifax: 300-850
  • Score from TransUnion: 300-850
  • VantageScore 3.0: 300-850

Bottom Line

Because there are hundreds of credit scores that measure many different probabilities, consumers generally do not need to be overly concerned with the type of score or even their number. It's also important to note that your credit score is a variable which can change every time your credit report changes. For these reasons, monitoring changes within a single score over time can be a better way to gauge your overall credit health.

These complicated facets of credit scores are exactly why we developed Credit Karma. By keeping the bureau and credit scoring model consistent, we are hoping to provide consumers with a single, easier-to-follow point of reference on their credit health. Best of all, it's always free to check your credit score with us. In this way, you can access your score as often as you want and always have a consistent baseline to better understand how your score is changing.

Disclaimer: All information posted to this site was accurate at the time of its initial publication. Efforts have been made to keep the content up to date and accurate. However, Credit Karma does not make any guarantees about the accuracy or completeness of the information provided. For complete details of any products mentioned, visit bank or issuer website.

All Comments

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 <quote>This is because whenever u take on new debt your score usually drops at first and then as you make steady payments on it u get positive credit for not only making on time payments but for lowering this new debt.</quote>

Why doesn't the government put a stop on this absolutely idiotic thing called credit score? People that have no debt and only one credit card, will always have a bad credit score. Absolute bs.

The banks, car dealers and whoever prefer customers that carry an addional financial burden already.

An entire economy based on debt. If you have no debt, then you are simply non existant for banks and credit rating agencies. No wonder the rest of the world is laughing about the US.

Why can't we switch to keeping track of negatvie entries such as late payment, default etc. instead of punishing people that pay on time, carry no balance?

Reply by
Givesuhe11

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"No wonder the rest of the world is laughing about the US." 

Thanks to TranUnion, equifax, etc... And thanks to sites like credit karma inc...

Reply by
onthegrid

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Other countries have credit bureaus and credit cards too. Creditworthiness is determined based on history as well.

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Folks this is a FREE site.  Additionally, the site uses a DIFFERENT scoring mechanism than say, your FICO score.  Similarly, the FICO score mechanism is different than the Vantage score 3.0 used on this site (myFico.com site has a new mechanism called FICO Score 8...but you pay 19.95 each to get a score based on information from each credit bureau, i.e., TransUnion, Experian and Equifax...or around $58 if you order all three at the same time).  Additionally, the free annual credit report you get as required by federal law DO NOT give credit scores.  They only list the information that the credit agencies have in their respective databases regarding your credit history.

For example, under Credit Karma's scoring mechanism, my TransUnion score is 670...pretty low relative to my 698 Experian.  So I paid $19.95 at the myFico.com site and ran my TransUnion info through the Fico Score 8 mechanism.  Based on my info with TransUnion, my FICO score was 709, rated good by their standards.  HOWEVER, the reasons give why I have the score I do, whether using Credit Karma or the myFico.com website, WERE THE SAME.  Thus even though the range of the scores were different, that was related to the difference in probably the weights used by each scoreing model.  However, BOTH the info on Credit Karma and my FICO as to the reasons why I have a particular score were the same: short credit history, high credit utilization (28% of my available credit---paid $300 today so that will lower it to 12%), high debt rate on installment plan (student loans are a killer--over $3K in INTEREST ALONE in one year!!!!  So much for the PAYE plan...I make my required payments on time , but that sucker seems to grow exponentially). Pretty much what is said on here about improving your credit score was said on the myFICO score website....as they tried to push me into paying more cash for their products.

So why did I pay $19.95 for my FICO score?  Because it is still the number one scoring mechanism used by lenders (some may dispute me saying that, but oh well).  I wanted to know if a lender requested that info today what they would see.  Yes TransUnion, Equifax and Experian all provide their own scoring models and can give you a rating based upon that mechanism, but i's not a FICO score.

My suggestion (and its just that...mine) is that this site can be used as one of several methods for monitoring your credit score.  But the adage "you get what you pay for" does apply.  This is a free site supported by credit card companies to advertise their products (full disclosure, the myfico.com website does the same thing).  I noticed what credit cards Credit Karma recommended for me on their site was different from myfico.com.  Again, that is because of the different scores I received from each site.  If you are concerned about your FICO, Experian, Equifax and TransUnion paid sites are rating you, then pony up the cash and pay for your score based on their model.

Bottom line, Credit Karma provided me with info behind their rating that was THE SAME as the FICO website.  While a 670 and 709 is a wide range, both told me what I need to do: pay off those stupid student loans!!

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I would urge all folks (particularly fellow senior citizens) who have no debt, no late payments, and MINIMAL credit card usage (something that Trans Union seriously downgrades you for) to take a long hard look at what that does to your AUTO INSURANCE RATES!!  In our case, we flipped the policy over into my spouse's name and instantly saved $235 per year.  Then, when you learn that you, too, are getting shafted, start raising hell!  Let's see if we can de-throne Trans Union!

7 Contributions
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I have a traditional score of 772 and a Vantage score of 702 (Grade C). Does that indicate some sort of issue? I have recently applied (successfully) for a mortgage.

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I have a score of 788. Should I bother to try and improve it or just leave it alone? There are some accounts that I could close that are not the oldest like store cards.

Reply by
erickweku

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Your credit score is pretty excellent. I will advise not to close any cards but maintain a zero balance on them because closing them can taking more than 20 points off your score. your credit can go higher only if you have your auto loan paid off, no recurring balances on credit card and more than 80% off your home loan or mortgage paid off. Keep on with the good works

Reply by
cecefun2

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Mine is worst than yours.

Reply by
pixcasey

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Do the Simulation of any combination on the credit simulator page. Do a mock run on closing old accounts. I believe the Vantage scoring system is different to the older 

  • FICO: traditionally between 300 and 850
  • Experian: 330 - 830
  • Equifax: 300 - 850
  • TransUnion: 300 - 850
  • scores so, play around with it. I've found it very difficult to increase my grade when it gets into the higher levels.

Good Job on maintaining good credit! : )

Reply by
Valblalock

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Leave it alone.  If you close accounts that are in good standing, it could lower your score.

Reply by
1doggone1

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leave it alone. people would kill for that score.

Reply by
Brooklynbad

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Your score will increase as the accounts age. You don't have to close any accounts. just continue to make on time payments. keep balances low and don't seeek any new credit.

Reply by
timmer

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leave it never close anything ruins your credit

Reply by
BlairJames

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thats GREAT credit wish i was up there congrats and god bless!!!

Reply by
PaulRambish

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Never close out your old accounts. That's why your score is so good b/c you don't owe anything on your old cards but still have very long history with your cards. That's the Key. Long history of something and not be late.

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Reply by
frugal1

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The best credit card offers and the lowest interest rates are given to those people with FICO scores above 750.  If that is correct, having a higher score only strokes the ego; it does not result in any tangible benefit.  However, please keep in mind that the scores provided by CreditKarma, while extremely useful, are not directly related to the FICO score.

Reply by
ok2483

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leave it alone!!!!!

Reply by
just4me36

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Do not close any accounts. when u do it hurts your credit score. It will drive it down....

Reply by
billinorlando

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I have heard that if you close any of your credit cards. It could bring your score down. And you should use them at least twice a year to keep them active. Canceled or inactive cards will lower you score, Bill

Reply by
mommateetee

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That's a nice score! Now protect it! You can always shoot for the 800 range for even better rates etc.

Do not close old accts. You will work against your best efforts if you do so.

Reply by
jeannemp24

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always good to try and improve your credit score. 

Reply by
josephine57

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leave it alone

Reply by
g81630

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I recently paid and closed my Toyota account for reason: truck was paid in full and my credit score was penalized-down 48 points...I've never face this kind of dilemna before..Does anyone know why? Thank you all...

Reply by
cassilynae

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That almost or is the best score a person can get. and do not ever close a credit account as it will negatively affect your credit.  Just cut up the card and forget about until the next one is sent to you, then activate it then destroy it agan...  and if oyu havent got a credit card yet,  you would want to buy somethiing at around 300-500 dollars then pay it off with payment in six months not earlier.  Than do it agan and you will have triple AAA credt score with anyone and can qualify for the great auto leasing programs, and could also if you have the income get a decent pertile home loan.

I hope this has helped...

Cassi

Reply by
KMberry93

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Be aware that any open account that you have once closed reflects negatively on your credit report.

Reply by
bear768

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never close an account it causes you to lose points alway keep all credit loans below 50% kepp all credit active even if it mea buying every month and paying it off you history on how you pay everthing on time is how credit it measured it like playing always be on top 

Reply by
wens2222

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is this true? i thought it was a soft hit and did not count against you

Reply by
bert61

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I have been told the better you score is the better  chance you have getting a low interest rate loan

Reply by
jfizzdizzle

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The more available credit the better. Dont close any.

Top Contributor

Reply by
dustinkirk

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It is a soft inquiry and does not count against you.

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Reply by
dustinkirk

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There is never a reason to carry a balance. It is just as useful to pay in full.

Reply by
conantgould

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requests by yourself to view your credit do not show up when others look at your credit

Reply by
strunker

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no it doesnt count as a hard inquiry ur retarded

Reply by
DiveDiva01

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1.  I think you'll find the inquiries are 'soft' inquiries.  No-one can place a hard inquiry on your credit unless you've given them signed, written permission to pull a credit report, as when you sign an application for a credit card or a loan. 

2.  I played the 0% balance transfer game many years ago.  Later, Chase came in and bought up the card issuing banks and I ended up with numerous Chase credit card accounts.  They allowed me to roll the credit limits from all those cards in to one.

Reply by
capriceclassic

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True it does not affect your score at all I check mine all the time.

Reply by
airbiscuit

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simply, not so--

Reply by
roberto1970

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yes it would be nice to improve it to 789 that way you could buy what you want and pay no interest rate

Reply by
blugene501

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 "did you all knnow that every time that "Credit karma" checks your credit score, it counts againist you by theem placing a "hard Inquiry on yiur credit ?"

This is not true. Do a little research!

Reply by
Cheerfulone55

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My FICO score while still low 673 is higher than EQ 667; EXP 638 and TransU 653.  What gives with tha?.  I know that I will improve once I refi, but until then it is what it is.  This has been a struggle sine my divorce, but am proud to say has improve...though many of you wonSubmit Your Comment't think so.

Reply by
kfuchs87

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Credit karma does not do a hard inquiry on your account... Read their FAQ...

But as for Chase your right. I had 2 citi cards that I was able to combine with no problem. Chase on the other hand told me no... Why I have no idea...

Reply by
lerainking1001

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It is a soft inquiry and shouldn't effect your credit.

Reply by
tleonar2

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Credit Karma is a soft inquiry, it won't show on your credit report

Reply by
danvain

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Completely bogus.  Couldn't be more wrong.

Reply by
SURFER8210

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WRONG.....!!!

Having Credit Karma check you score results in a SOFT inquiry...!!

If you don't know what you're talking about sometimes it's better to say nothing...!!!

Reply by
royol31

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I update my Creditkarma score often, but I never see any indication of an inquiry.  I have noticed that while my 3 bureau scores are continuing to rise, my vantage score is declining.  Could it be because of the updating?  Also, there is no information offered on the vantage score, such as inquiries listed, etc.  Any insight on the worth of the vantage score?

Reply by
BEEFYKID

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HA HA HA FUNNY

Reply by
amadues

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I pulled my 3 days ago.  Credit Karma "does not" place HARD InQuiry!!!!!!!

Reply by
OneFastCourier

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I update my CK everyday. I have never seen any inquiries on my report such as you speak.

Reply by
jenholloway

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Self-pulled inquiries do not count against you, only inquiries by potential credit grantors do.  

Reply by
dockside58

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Don't close any accounts. It hurts your score!

Reply by
1JVCE3C5

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Credit Karma does a "soft pull" which does not count against your score.  It's in their documentation.

Reply by
just4me36

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No leave them alone. I did that and it hurt my credit. Just use them once in a while for a very small ammount and pay it off. that will help it go up..Thats what I am doing now. The higher the score the better,

Reply by
donnaldale

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DOn't ever close an acoount.   10% of your score is a healthu mix of credit.  Go but one lunch a month if it is a credit card and pay it and pay it on time.  your score consists of 35% payment history  30% outstanding debt 15% length of credit history 10% recent inquiries 10% healthy mix types of credit

Reply by
ArthurJ2012

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Keep improving your credit score!

Reply by
Orlandomike

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If things are running well for you dont bother!

Reply by
DLFG

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Actually they say that closing the accounts you don't use negatively effects your credit scores because it lowers your "available" credit and the score is based on the percent used out of the total available. the more credit you have and the less you use the higher your score! So don't close them just let them ride and cut up the cards so they don't get stolen or used accidently. 

Reply by
joshanderson24

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In order to prove your score DO NOT CLOSE REVOLVING ACCOUNTS! As far as store cards(installment cards) are not good for your credit they are actually bad for your credit. As far as revolving accounts pay them up to 75% or so and do not use them and make timely payments that will booost your score. DO NOT OPEN ANY NEW ACCOUNTS while trying to improve your score. Nowadays a 788 score is not that good, yes its good but its not real good. I would improve my score if i was you, close that store card(its not any good) and pay down your revolving accnts to 75% or so and do not touch them wait approx a month to 3 months to check your score( it depends when the buisness reports to the agency some report monthly others report every 3 months). Hope this helps

Reply by
DConnectionsTEK

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Don't Close any accounts even if paid in full.  It will lower the avarage age of your total credit and thus cause a drop in your credit score.

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I got an auto loan a few months ago and the credit union did not even look at my transunion or equifax credit scores even though I showed them. They looked at experian instead which did not have a score registered. Of course I am being charged a higher interest rate.

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In my case, I have multiple credit cards but only carry a balance on 2 of them. I do this because I'm on a fixed income and I like the security of the other cards in case of an emergency like a car repair that nowadays can be in the thousands of dollars. Or a major appliance needing replaced etc. What ticks me off is that a person in my shoes who gets the credit and doesn't abuse it or max it out is penalized whenever I attempt to aquire new credit. I think that it's bulls#!t that every time a CC company checks my credit my credit score has to take a hit. And it can take up to 3 months for that hit to recover. And the crazy part is that I do get the card I applied for. The rules should be changed that if your score takes a hit every time you apply for a card, that hit should not happen if the person applying for the card is approoved and in fact gets the card applied for. Sorry, but this credit game is rigged. There shouldn't be 50+ different scoring methods out there. When you're dealing with a persons credit, it's a very, very important matter. It affects just about every aspect of their life, from owning a home, car, all consumer items, and even whether or not this person will get a good job. More and more emphasis is being put on credit responsibility. So there should be like 5 different methods of scoring instead of 50+ ways. And there shouldn't be 3 reporting agencies, there should be 1. Meaning 1 score, not 3 different scores that can differ by 100 points or more. It's a crap shoot every time we apply for credit what the result will be depending on which of the more than 50 methods employed the credit agencies the banks will use to determine our credit worthiness. I do realize that there's a cost for every negative thing we engage in throughout a person's life, but, there shouldn't be a cost whenever a person shows responsibility in any field of endeavor. And that includes ones credit.

Credit Karma Team
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Hi coryguy52,

Thanks for posting. We appreciate your insight. 

Reply by
cascadian12

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I agree! If "credit" is so important, than "scores" should be provided by a non-profit organization or government agency, whose customer is "WE, the people," not the banks. Credit Karma could still make money by recommending credit cards and loans tailored to individual credit profiles.

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I've been using credit karma for several months. I applied for a loan, and the three scores that the lender quoted me were all three about 100 points LOWER than what credit Karma says. This put me under the lending score, and i just wasted half my lunchbreak applying for a loan i dont qualify for, not to mention the months ive been relying on credit karms. Very dissapointing.

Credit Karma Team
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Hi mellisaj6,

Sorry to hear this. We provide the VantageScore 3.0 model from TransUnion and Equifax, but it sounds like your lender may have been using a different credit bureau or score model. 

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When your score goes either up or down, it would be helpful to tell us why. If it went up, what did we do to cause it so that we can keep doing it. If it went down, what did we do so we don't do it again. Rebuilding credit is mentally exhausting without the facts!

Credit Karma Team
Top Contributor
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Hi mstme64,

Sine Credit Karma doesn't calculate your score, we can't say for certain why it changes the way it does. We do provide your credit reports so that you can compare the "before" and "after" of recent changes. 

Top Contributor
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It happened to me, as well.  On the very same day that CreditKarma showed my mortgage to be paid off in full, my Vantage score dropped 47 points!  It came as a total shock to me, because I wrongly assumed paying off that major debt would somehow improve my score, not worsen it.  Go figure :)

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