FICO® and TransUnion® are two terms affiliated with credit that you may be familiar with. TransUnion is a consumer credit reporting agency — one of the three major credit bureaus that maintains credit reports on most consumers. FICO generally refers to a FICO credit score, which is issued by the Fair Isaac Corporation and is one of the most popular types of credit scores.
Learn more on what TransUnion and FICO are, how they differ from each other, and why both are important when it comes to your credit profile.
Key Points
• TransUnion is a credit reporting agency that collects and maintains consumer credit data, while FICO Score is a credit scoring model that analyzes this data to assess creditworthiness.
• TransUnion provides credit reports with details like payment history and outstanding debts, while the FICO Score calculates a numerical credit score based on this information.
• Lenders use TransUnion reports to review credit history and FICO Scores to gauge the risk of lending to a borrower.
• TransUnion offers credit monitoring and identity theft protection services, while FICO focuses on developing scoring models for credit risk assessment.
• Both affect loan approval decisions, interest rates, and financial opportunities, but consumers can improve their FICO Score by managing the data reported by TransUnion.
What Is a Credit Report?
Your credit report is a record that details your history of borrowing and repaying loans, as well as your use of credit. The three major credit reporting agencies — Equifax®, Experian®, and TransUnion — each compile consumer credit information, meaning many individuals have reports from all three.
Credit scores are usually determined based on the data in these reports. One way to build your credit is by enhancing the information reflected in your credit report.
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What Is TransUnion?
TransUnion is a leading global credit reporting agency that collects and manages consumer credit data to help lenders and businesses assess credit risk. Alongside Equifax and Experian, TransUnion is one of the three major credit bureaus in the United States. It compiles information such as payment history, credit utilization, and outstanding debts, which are used to generate credit reports for individuals and businesses.
In addition to providing credit reports, TransUnion offers services like credit monitoring, fraud protection, and identity theft prevention.
Recommended: Which Credit Bureau Is Used Most?
What Is a FICO Score?
A FICO Score is a widely used credit scoring model developed by the Fair Isaac Corporation to assess an individual’s creditworthiness. It is calculated based on factors such as payment history, credit utilization, length of credit history, types of credit accounts, and new credit inquiries.
Ranging from 300 to 850, a higher FICO Score indicates lower credit risk, making it easier for borrowers to qualify for loans and secure favorable interest rates.
Difference Between TransUnion vs. FICO
The key difference between TransUnion and FICO is their roles in the credit industry. TransUnion is a credit reporting agency that collects and maintains consumer credit data, such as payment history, debts, and credit accounts, and provides credit reports. On the other hand, FICO is a credit scoring model that uses the data from credit reports, including those from TransUnion, to generate a numerical score assessing a person’s creditworthiness.
Credit scores and credit reports are two different things, although they are similar. TransUnion, along with the other two major credit reporting agencies — Experian and Equifax — created the VantageScore® credit score model in 2006. When you compare VantageScore vs. FICO, you are comparing apples to apples, as these are two different credit score models.
How Credit Scores Are Calculated
There are many different types of credit scores, calculated by different companies. Each company may use a different formula or different information. Some companies may provide their specific criteria, while others may keep that information proprietary. The Fair Isaac Corporation lists five factors that affect your FICO score:
• Payment history (35%)
• Amounts owed (30%)
• Length of credit history (15%)
• Credit mix (10%)
• New credit (10%)
Lowering your credit card utilization is one way that you may be able to build your credit score.
Why Are There Different Scores?
There are different types of credit scores because there are different companies that provide and promote these scores. Each company creates credit scores because they believe they have a better model for defining credit risk, and can sell that model to a bank, credit union, or spending app. The good news is that most of these credit score companies use similar information, which means that each of your credit scores should usually be within a few points of each other.
How to Check a TransUnion Credit Report
If you want to check your TransUnion credit report, follow these steps:
• Visit the TransUnion website: Go to TransUnion’s official site at www.TransUnion.com.
• Create an account: Sign up for an account by providing personal details such as your name, address, Social Security number, and date of birth.
• Request a credit report: Once your account is set up, you can access your credit report for free once a year through AnnualCreditReport.com or request it directly from TransUnion.
• Review the report: Look through your credit report for any inaccuracies or unfamiliar accounts that could be signs of identity theft.
• Dispute errors: If you find mistakes, use TransUnion’s online platform to file a dispute for corrections.
How to Check a FICO Score
If you want to check your FICO Score, you can do so in a variety of ways:
• Check with your credit card issuer: Many credit card companies, like Discover and American Express, offer free FICO scores to customers.
• Visit MyFICO.com: The official FICO website provides access to multiple score versions for a fee.
• Use free credit monitoring services: Platforms like Experian offer free access to your FICO Score.
• Contact your bank or credit union: Some banks and credit unions provide FICO scores as part of their customer benefits.
Recommended: Free Credit Score Monitoring with SoFi
The Takeaway
TransUnion is one of the three major credit bureaus that produces credit reports. FICO Scores, on the other hand, are credit scores produced by the Fair Isaac Corporation and are one of the most popular forms of credit scores, used by 90% of top lenders.
While credit reports (such as TransUnion) and credit scores (such as FICO) are similar, they have different roles when it comes to evaluating your credit.
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FAQ
Is the FICO Score more important than TransUnion?
Many lenders use your FICO Score as a way to determine whether they will extend you credit, such as a new credit card. If you are applying for a new loan or a mortgage, a bank or credit union may pull your full credit report from a credit bureau such as TransUnion, Equifax, or Experian.
Do lenders look at FICO or TransUnion?
Whether a lender looks at just your credit score (such as your FICO credit score) or your full credit report (such as from TransUnion) will depend on why they are interested in you. Often, if you are applying for a credit card or something with a smaller balance, they may only look at your credit score. If you are applying for a mortgage or something with a larger credit line, the lender may look at your full credit report.
Is TransUnion the correct credit score?
TransUnion is not actually a credit score — TransUnion is a credit bureau that provides a credit report. It is one of the three major credit bureaus in the United States, along with Equifax and Experian. Lenders may pull a credit report from Equifax, Experian, or TransUnion, depending on a number of different factors that are generally out of your control as a consumer.
Is FICO owned by TransUnion?
No, FICO credit scores are issued by the Fair Isaac Corporation. TransUnion is a separate company that is primarily focused on issuing credit reports. TransUnion issues credit score updates when new information is received that is relevant to your credit report.
What is a good FICO Score?
FICO scores are typically categorized into five levels, ranging from poor to exceptional. A FICO Score between 670 and 739 is considered good. Scores falling within the very good range (740 to 799) or the exceptional range (800 to 850) are even more favorable.
Which credit score is most accurate?
No single credit score is considered more accurate than another. Instead, different credit scores offer unique insights into a consumer’s spending and borrowing patterns. Because of this, banks and lenders may rely on different scoring models based on what they find most relevant or predictive for their needs.
photo credit: iStock/tolgart
SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.
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