A Guide to Credit Scoring Models/Industry-Specific Scores

Lenders can also use an industry-specific score that’s built on a base score and optimized to look at certain areas more closely than others (for instance, past car loans if you’re financing a new vehicle or credit card payments if you’re applying for more plastic). “Lender oftentimes will have a very specific algorithm that they're going to use,” Chaplin says. “Oftentimes they're developed by the bank or card issuer, and those are specific to home, car or credit cards. There literally could be thousands of iterations to determine creditworthiness.” Insurers may also look at your credit history, but typically not your numeric score, since they’re assessing risk, not creditworthiness. “[insurance underwriters] use the data that's found in a credit history with one of the three bureaus to determine a consumer's likelihood to file a claim,” Sprauve says