Who controls your credit?
Who Regulates Credit Bureaus? The FTC and CFPB oversee the bureaus and enforce the Fair Credit Reporting Act. The FTC is the United States' main consumer protection agency that attempts to thwart any deceptive and fraudulent practices. The CFPB makes sure lenders abide by federal consumer financial laws.
The Federal Trade Commission (FTC) is one of many U.S. federal agencies which regulate the consumer credit system and enforce the laws related to it.
Credit scores are controlled by the major credit bureaus (Experian, Equifax, and TransUnion), which compile data, and the analytics companies (FICO and VantageScore) whose algorithms are used to calculate the scores. They are regulated by the Federal Trade Commission and the Consumer Financial Protection Bureau.
Your credit score is one of the most important measures of your creditworthiness. For your FICO® Score, it's a three digit number usually ranging between 300 to 850 and is based on metrics developed by Fair Isaac Corporation.
Credit scores come from the three major credit reporting agencies: Equifax, Experian, and TransUnion. Consumers have a belief that they are somehow owned, managed and controlled by the federal government but they are not, in fact. At a fundamental level, the credit bureaus all operate as private, for-profit companies.
The primary credit scoring models are FICO® and VantageScore®, and both are equally accurate. Although both are accurate, most lenders are looking at your FICO score when you apply for a loan.
Although ranges vary depending on the credit scoring model, generally credit scores from 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.
This typically only happens when debt collection issues, government agencies or court orders are involved. For example, someone can perform a hard credit inquiry on your credit report without permission if: They are a debt collector trying to verify what you owe.
Nationwide consumer reporting companies
There are three big nationwide providers of consumer reports: Equifax, TransUnion, and Experian.
Highlights: While older models of credit scores used to go as high as 900, you can no longer achieve a 900 credit score. The highest score you can receive today is 850. Anything above 800 is considered an excellent credit score.
Why is my credit score going down when I pay on time?
Using more of your credit card balance than usual — even if you pay on time — can reduce your score until a new, lower balance is reported the following month. Closed accounts and lower credit limits can also result in lower scores even if your payment behavior has not changed.
The perfect credit score is an 850 — but experts say this is the number to aim for.
Having no credit is better than having bad credit, though both can hold you back. Bad credit shows potential lenders a negative track record of managing credit. Meanwhile, no credit means lenders can't tell how you'll handle repaying debts because you don't have much experience.
- Paying your loans on time.
- Not getting too close to your credit limit.
- Having a long credit history.
- Making sure your credit report doesn't have errors.
The credit scores and credit reports you see on Credit Karma come directly from TransUnion and Equifax, two of the three major consumer credit bureaus. They should accurately reflect your credit information as reported by those bureaus — but they may not match other reports and scores out there.
It's recommended you have a credit score of 620 or higher when you apply for a conventional loan. If your score is below 620, lenders either won't be able to approve your loan or may be required to offer you a higher interest rate, which can result in higher monthly mortgage payments.
The minimum credit score needed for most mortgages is typically around 620. However, government-backed mortgages like Federal Housing Administration (FHA) loans typically have lower credit requirements than conventional fixed-rate loans and adjustable-rate mortgages (ARMs).
Three major credit reporting agencies provide credit reports: Equifax, Experian, and TransUnion. 123 These may be the safest routes to obtaining your credit history, which ultimately affects your personal credit score.
How rare is an 800 credit score? An 800 credit score is not as rare as most people think, considering that roughly 23% of adults have a credit score in the 800-850 range, according to data from FICO. A score in this range allows consumers to access the best credit card offers and loans with the most favorable terms.
| Average FICO 8 Score by Generation | ||
|---|---|---|
| Generation | 2022 | 2023 |
| Generation Z (ages 18-26) | 679 - Good | 680 - Good |
| Millennials (27-42) | 687 - Good | 690 - Good |
| Generation X (43-58) | 707 - Good | 709 - Good |
How rare is a 750 credit score?
Your credit score helps lenders decide if you qualify for products like credit cards and loans, and your interest rate. You are one of the 48% of Americans who had a score of 750 or above as of April 2023, according to credit scoring company FICO.
When you request a copy of your credit report, you will see a list of anyone who has requested your credit report within the past year, including any employers or prospective employers who have requested your report within the past two years for employment purposes.
If you find an unauthorized or inaccurate hard inquiry, you can file a dispute letter and request that the bureau remove it from your report. The consumer credit bureaus must investigate dispute requests unless they determine your dispute is frivolous.
Filing a lawsuit against the credit bureaus, banks and debt collectors is often the best way for consumers to get harmful marks off of their record. We can help you get errors removed so that your credit score is no longer being negatively affected.
You have the right to request one free copy of your credit report each year from each of the three major consumer reporting companies (Equifax, Experian and TransUnion) by visiting AnnualCreditReport.com. You may also be able to view free reports more frequently online.
