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Which Credit Bureau Is Used Most for Auto Loans?

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Austin Kilham

Austin Kilham

Updated July 23, 2021
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Which Credit Bureau Is Used Most for Auto Loans?; Which credit bureau is the one most used for auto loans? Learn the answer and more about credit and auto loans from Lantern by SoFi.
Your credit score has a major impact on what kind of loan auto lenders will offer you. Your score is based on your credit history, a complete record of your debts and payment history compiled by the three major credit reporting bureaus Experian, Equifax, and TransUnion. But you may find yourself wondering which of these scores is most important? Do auto lenders prefer one over the others? And is there anything you can do to improve your score? Here’s a look at the credit scores auto lenders use most and what you can do to try to secure a better loan and save money in the long term. 

What Is a Credit Bureau?

At the most basic level, credit bureaus are companies that collect data from your lenders and creditors. They compile this data into your credit history and provide that information to potential lenders in the form of a credit report. This information typically includes factors like how much debt you currently owe and whether or not you have a history of making on-time payments.There are three nationwide credit reporting bureaus in the US: Equifax, Experian and TransUnion. Despite a common misconception, the credit bureaus, also known as credit reporting agencies, do not make lending decisions themselves. Rather, lenders use the reports provided by the credit bureaus to determine your creditworthiness, and each may have its own criteria for deciding when to approve or deny a loan. The bureaus also give you the chance to look at your own report so you can understand your credit and correct any errors. You can request a free report from each bureau once per year. 

Do Credit Scores Differ Between Credit Bureaus?

Your credit score may differ from bureau to bureau. That’s because it’s up to lenders and creditors to decide which information they report and who they report it to. While most lenders will report to all three credit bureaus, they aren’t required to and not everyone will. When you apply for a new loan or new credit, your lender will perform a credit check, usually with just one of the main credit bureaus. Credit inquiries like these are recorded in your credit score and can lower your score in the short term. However, they only show up with the bureau the lender used for the credit check. This can be another source of discrepancy between different credit scores. Each credit reporting bureau will also have a slightly different credit scoring system, and those methodologies change over time as the bureaus try to make their scores more accurate. 

Which Credit Bureaus Are Used Most for Auto Loans?

Equifax and Experian are the most commonly used credit bureaus by auto lenders. They offer services that are directed specifically at the auto industry, and each gets a portion of their revenue from the industry. Though perhaps not as popular, TransUnion may also be used by auto lenders when they’re making their loan decisions. Ultimately, it may not matter much which score your auto lender uses. Generally speaking, your credit report and score will be very similar no matter which bureau they go to.However, if one of your credit reports is frozen—perhaps you’ve experienced identity theft recently and wish to prevent fraudsters from opening accounts in your name—it can be useful to find out which report your dealer uses. That way you can unfreeze your report if the dealer needs to see it. 

Why Is Your FICO® Score Important?

Auto lenders will also commonly use your FICO® score, which is generated by the Fair Isaac Corporation, when making loan decisions. FICO gathers data from each of the major credit reporting bureaus to create a base FICO score, which is widely used by many lenders. They also create industry-specific FICO scores, including a score tailored to auto lenders. Your FICO score is a three-digit number ranging from 300 to 850. It's a numerical representation of your credit history. The higher your score, the more likely creditors are to offer you a new loan or a refinance with favorable terms, interest rate, and costs. (Learn more about auto loan terminology.) A lower interest rate can save you thousands of dollars over the life of the loan. A “good” FICO score is generally considered to be in the 670 to 739 range (740 to 799 is “very good,” and above that is “exceptional”). A poor score is anything less than 580.

What Is the Difference Between Your FICO® Score and Credit Scores?

Theoretically, your FICO score and your other credit scores could be the same, but they aren’t always. FICO is one of a number of companies that offer credit scores, including the credit reporting bureaus and VantageScore, another big player in the industry. Each company will use a different scoring model, which can lead to slightly different scores. Additionally, FICO offers many different scores, including score models that work with each reporting bureau’s database. Lenders choose whose score they want to use.

How Can You Improve Your Credit Scores? 

A good credit score is important to give you access to the most loan options and the best terms and interest rates. A few steps may help you improve your score over time.
  • Correct credit report errors. Take a look at your credit report from each of the reporting bureaus. Make sure the information is right, and contact the bureaus if anything needs to be corrected. 
  • Make payments on time. Consider automating your payments to ensure you never miss one. 
  • Pay off debts. You may want to target high interest credit card debt first. As you pay off high interest debts, you’ll have more money to direct toward becoming debt free. 
Note that applying for an auto loan will temporarily lower your credit score. Why? When consumers take on new debt, they’re more likely to miss payments. But a few months of on-time payments will likely make up for the dip or even improve your score.

The Takeaway

Experian and Equifax are the credit bureaus most commonly used by auto lenders. Yet, it ultimately may not make that much difference which bureau your auto lender uses. As a consumer, it may be more important for you to make sure your credit is as healthy as possible by paying off debt and making payments on time. That way, no matter what bureau a lender uses, you’ll have the best chance to get an auto loan or a refinance loan that works for you. To learn more about loan refinances and to compare loans from our network of lenders, visit Lantern by SoFi
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website on credit (https://www.consumer.ftc.gov/topics/credit-and-loans)The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.SOLC0621110

Frequently Asked Questions

What is a credit bureau?
What is the difference between credit bureaus?
Why are there multiple credit bureaus?
Which credit bureaus are used the most for car loans?
How can you improve your credit?

About the Author

Austin Kilham

Austin Kilham

Austin Kilham is a writer and journalist based in Los Angeles. He focuses on personal finance, retirement, business, and health care with an eye toward helping others understand complex topics.
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