Credit reference agency Equifax has updated its credit score scale to help improve customers' understanding how their credit information may be viewed by a lender and whether a credit application is likely to be approved.
Equifax collects data about you to form your credit report and this information is used to generate your Equifax credit score, which gives you an indication of your chances of being approved for credit.
Here, Which? explains what Equifax's new scale means and how to boost your credit score.
There are three main credit reference agencies in the UK: Experian, Equifax and TransUnion - and each will hold a credit report and generate a credit score based on your information.
Previously, the Equifax credit score scale ranged from zero to 700 and fell into five bands: very poor, poor, fair, good and excellent.
Now, your Equifax score is out of 1,000 and is still divided into five bands but now starts on 'poor' and includes a new rating category, 'very good'.
|What your score means||Equifax's old credit score scale||Equifax's new credit score scale|
|Very poor||0 to 278||-|
|Poor||279 to 366||0 to 438|
|Fair||367 to 419||439 to 530|
|Good||420 to 466||531 to 670|
|Very good||-||671 to 810|
|Excellent||467 to 700||811 to 1000|
Equifax says that the new system will not make it easier or harder for Equifax customers to access credit.
For example, if someone had a score of 467 previously - in the excellent band - it is more than likely that their score will increase to somewhere between 811 and 1000 and therefore remain in the excellent band.
There's no such thing as a universal credit score. Each lender has its own system to score and decide whether or not to accept you as a customer, meaning you could be turned down by one, and successful with another.
But to give you a better idea of how your application might be viewed by lenders, credit reference agencies produce their own version of your credit score.
The higher this number, the higher your chances of getting the best credit deals - but a good score from a credit reference agency is no guarantee your application will be successful.
Lenders might check one, two, or all three agencies before approving your application, so it's important to ensure your score is in good shape with all three. This can be tough as each credit reference agency might collect slightly different information and will have its own way of scoring.
Equifax's credit score scale change brings it almost in line with Experian's which ranges from 0 to 999 but you still might find it confusing as the bands don't correlate and TransUnion's credit score only goes up to 710.
For example, a score of less than 560 is 'very poor' with Experian and 'poor' with TransUnion but 'good' with Equifax.
|What your score means||Very poor: 0 to 560||-||Very poor: 0 to 550|
|Poor: 561 to 720||Poor: 0 to 438||Poor: 551 to 565|
|Fair: 721 to 880||Fair: 439 to 530||Fair: 566 to 603|
|Good: 881 to 960||Good: 531 to 670||Good: 604 to 627|
|-||Very good: 671 to 810||-|
|Excellent: 961to 999||Excellent: 811 to 1,000||Excellent: 628 to 710|
Lenders, landlords, utility companies, insurance companies and others may look at your credit report to help them decide whether or not to approve you for their products or services.
So it's important to make sure your credit score is as high as possible.
Paying back what you owe on time, registering on the electoral roll, getting rental information linked to your report and maintaining a low credit balance can help you boost your score.
All three agencies should hold the same basic information such as whether you're on the electoral roll at your current address and how much you currently owe lenders, but it's likely there'll be three slightly different versions of your credit report.
This is because the amount of personal data in a credit report is growing, with individuals and companies starting to share more information about payment habits but not necessarily to all agencies.
So as the information held on you can differ between the credit reference agencies, it's best to check all three.
You can do this for free and see a basic version of your report or you can opt for a paid subscription for more detail. After a 30-day free trial, Experian's CreditExpert account and Transunion charge £14.99 a month, while Equifax costs £7.95 a month.
There may be some instances where you'll need to use one particular agency. For example, you may apply for a mortgage with a particular lender which uses Equifax to check your credit report. If so, you should check if your Equifax credit report is up-to-date and accurate to boost your chances of getting approved.
Get to grips with the often mysterious world of credit reporting, finding out what can impact your personal record and the wider implications on your ability to borrow in one of the latest episodes of the Which? Money podcast.