Finances

TransUnion vs. Equifax: What is the difference?

Learn the key differences between TransUnion and Equifax, two of the three major credit bureau! Keep reading and find out more!

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by Sabrina Paes

Published on 03/25/2023

Get on top of your credit, compare Equifax and TransUnion

TransUnion vs. Equifax
Get on top of your credit, and compare Equifax and TransUnion. Source: Stealth Capitalist

When it comes to the world of credit, there are two main names that you should know: TransUnion vs. Equifax.

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If you want to learn about the important differences between these two leading credit agencies, this article is for you! So here we will break down everything you need!

What is the difference between Equifax and TransUnion?

TransUnion and Equifax are two major credit reporting agencies that provide credit reports to lenders, businesses, and consumers.

One of their main differences is the range of their credit scores. In this sense, TransUnion scores range from 300 to 850, while Equifax scores range from 280 to 850.

Also, TransUnion reports covering a longer period, with 84 months of credit history, versus Equifax’s 81 months.

By monitoring reports and scores from both bureaus, you can stay informed about changes in your financial standing, which can help you avoid financing rejections.

These credit unions also offer an affordable option that monitors their credit report and provides identity restoration support if needed.

Equifax 

Young happy lucky woman student feeling excited winner looking at cellphone.
The difference between Equifax and TransUnion. Source: Adobe Stock

Equifax is an American consumer credit reporting agency specializing in collecting and analyzing individual credit data.

Moreover, it uses a scoring model similar to the well-known FICO score. Thus, it measures an individual’s creditworthiness by assessing five factor:

  • Payment history (35%);
  • Current credit utilization ratio (30%);
  • Total credit history (15%);
  • The diversity of your accounts (10%);
  • New or recent accounts opened (10%).

Equifax also ranges its scores according to its criteria: poor, fair, good, good, and excellent. Thus, it is based on a range between 280 to 850 points.

Notably, it’s maximum score of 850 surpasses FICO’s highest score threshold of 850.

TransUnion

TransUnion is one of the leading credit-monitoring companies, providing customers credit scores and helping them understand how and why they are calculated.

Moreover, it scores range from 300 to 850, with a higher score indicating greater financial responsibility to lenders. It utilizes the VantageScore method:

  • Payment history (40%);
  • Length and type of credit (21%);
  • Credit utilization (20%);
  • Total credit balance(11%);
  • Recent credit behavior (5%);
  • Available credit (3%).

Based on TransUnion’s score assessment through VantageScore, scores below 500 fall into the “very poor” category, whereas those between 781-850 are considered excellent.

Finally, with it’s services, customers can gain insight into their financial health while aiming toward an excellent TransUnion score.

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Why can your TransUnion and Equifax scores differ?

TransUnion vs. Equifax are two of the three major credit-reporting bureaus, and it’s not uncommon for consumers to find differences in their credit scores.

After all, several factors could explain why they are producing different numbers. The two companies may use different scoring model.

Moreover, this is because not every lender reports to each of the three national credit bureaus.

Also, TransUnion score could be outdated compared to your Equifax score.

Finally, knowing why they provide different results can help you take control of your financial well-being by monitoring your score accurately.

Which score is more important: TransUnion vs. Equifax?

TransUnion and Equifax are essential pieces in the credit reporting puzzle, as one has just as much influence as the other. Typically, each agency processes similar information.

Yet, when one confess having low finances or poor scores during loan applications, there is often no way of knowing which bureau will pitch in with their assessment.

Thus, it should be regarded as necessary for customers to stay alert about both TransUnion and Equifax ratings – not just theirs but those of other firms too.

These precautions can be taken to facilitate a smooth diagnostic and rate-delivering cycle.

And since all data being compared can bear fruitful results, chances for desired decisions stretch much higher.

Which score is most accurate: TransUnion vs. Equifax?

point finger on screen mobile phone closeup, person texting text
Which score is most accurate? Find out! Source: Adobe Stock

Understanding credit scoring can be difficult. TransUnion and Equifax maintain separate reporting models that offer lenders different scores via their systems.

These distinct approaches branch out further since each lenders may use specific standards for evaluating information from either player.

Ultimately, it’s up to the individual franchise to identify which third-party service fits their organizational needs moving forward.

Still, the starting points of inaccuracies might differ between TransUnion and Equifax.

However, both share comparable sources that finally unite for an essential take on what can prove to be a borrower’s financial stability or lack thereof.

Bottom line

Credit reports and scores are important in maintaining good financial standing. To ensure that you stay updated, it is necessary to get one from TransUnion or Equifax.

It is best to understand the differences between the two companies and compare their services to make an informed decision.

Regarding regular monitoring, you can take advantage of each credit bureau’s affordable options.

Taking these measures will help you avoid rejections when applying for loans and track any unauthorized activity promptly.

To learn more about these services and make an informed choice for your needs, check our post about choosing your credit repair company.

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About the author

Sabrina Paes

Content Writer, Copywriter, and Ghostwriter. Content marketing professional with 5 years of experience. Specialist in investment, finance, and technology niche. MBA in Marketing at the University of São Paulo, Brazil. Content Writer by Rock Content, and University of California (UCDAVIS).

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