Equifax Credit Scoring

What Is a Credit Score by Equifax?

Equifax offers several proprietary credit scoring models to assess an individual's creditworthiness. These scores are based on information from an individual's credit report, including payment history, credit utilization, length of credit history, types of credit accounts, and recent credit inquiries. Higher scores indicate lower credit risk.

How Equifax Calculates Scores

Equifax's credit scoring systems include:

1. Equifax Credit Score: The Equifax Credit Score is a numerical representation of an individual's creditworthiness. It is based on information from the individual's credit report, including payment history, credit utilization, length of credit history, types of credit accounts, and recent credit inquiries. The Equifax Credit Score ranges from 280 to 850, with higher scores indicating lower credit risk.
   
   2. Equifax Risk Score: The Equifax Risk Score is designed to predict the likelihood of an individual becoming delinquent on credit obligations within the next 12 months. It takes into account various factors such as credit history, outstanding balances, payment patterns, and public records. The Equifax Risk Score helps lenders assess the level of risk associated with extending credit to a particular individual.
   
   3. Beacon Credit Score: The Beacon Credit Score is a credit scoring model developed by Equifax for the Canadian market. It evaluates an individual's creditworthiness and is used by lenders to make decisions on loan approvals and interest rates. The Beacon Credit Score ranges from 300 to 900, with higher scores indicating lower credit risk.

The specific details and algorithms used in these scoring systems are proprietary information and not publicly disclosed.

Impact on Lending Decisions

Lenders use Equifax credit scores to evaluate the creditworthiness of individuals when extending credit. A higher score generally indicates a lower risk of default, which can influence the terms and approval of loans or credit applications.

Credit Protection & Reports

Equifax provides services to help individuals monitor and protect their credit. These services may include access to credit reports, credit monitoring, and alerts for significant changes to credit information. Regularly reviewing your Equifax Credit Report can help ensure the information is correct and identify areas for improvement.

Related

• FICO Score: A widely used credit scoring model developed by Fair Isaac Corporation.
• Experian Credit Score: A credit scoring model provided by another major credit bureau.
• VantageScore: A credit scoring model developed jointly by the three major credit bureaus.
• Credit Report: A detailed record of an individual's credit history, compiled by credit bureaus.

Understanding your Equifax Credit Score is essential for managing your credit health and making informed financial decisions.