Banks may request for your credit report before they give you a loan. Find out about the credit bureaus, credit reports and the things that can affect your credit score.
Key takeaways
- Banks may use your credit report to assess your financial situation.
- Every default or late payment leaves a mark on your score.
- Learn good money habits to ace your future credit report.
What is a credit bureau?
A credit bureau is an agency that collects and stores information on your credit history, such as loans, credit card applications and repayment records.
Information in the credit report is provided by members of the credit bureau such as banks and credit card companies, and obtained from public sources on bankruptcy.
Approved credit bureaus
For banks and finance companies, only 2 credit bureaus are allowed to obtain such information in Singapore. They are Credit Bureau (Singapore) and Experian Credit Bureau Singapore (ECBS).
For licensed moneylenders, the Moneylenders Credit Bureau (MLCB) is the central repository of data on borrowers’ loans and repayment records with licensed moneylenders. It allows licensed moneylenders to assess the creditworthiness of borrowers and help borrowers avoid borrowing beyond their means.
What is a credit report?
A credit report is a compilation of your credit payment history collected across all your banks. It is issued by a credit bureau to banks, finance companies and credit card companies when they make enquiries about you. You may also request a copy of your report from the bureaus.
The credit report includes information such as:
- Basic personal profile data (excluding contact addresses and telephone numbers).
- Records of all credit checks made on you.
- Credit repayment trend for the past 12 months, including late payments on credit card bills.
- Default records, if any – displayed from the date it was uploaded to the credit bureau.
- Bankruptcy records, if any – displayed for 5 years from the date of discharge. If you are able to repay your debts in full, the Bankruptcy Order will be annulled and your bankruptcy record will be removed immediately.
- Closed or terminated credit accounts – displayed for 3 years from the date the account was reported closed or terminated.
- Aggregated outstanding balances.
- Aggregated credit limits.
Why it matters
The credit score on your report shows how likely you will repay your debts.
Banks will assess your creditworthiness by looking at the credit score. The score helps them make better lending decisions when you apply for loans and credit cards.
A good credit repayment history makes it easier for you to qualify for loans and credit cards in the future.
Factors that affect your report
A number of different factors could affect your credit report:
- Credit you have now - This includes the number of accounts open or active that provide you with a credit facility.
- Credit history - Long-established credit history shows that you're a reliable borrower.
- Enquiry activity - Too many new applications or enquiries show that you're trying to take on more debt. Don't apply for a new credit card unless you need it.
- Recent credit - If you have recently taken multiple new credit facilities within a short period, you may be overextending yourself.
How to get a copy of your report
To check your credit score, contact Credit Bureau Singapore or Experian Credit Bureau Singapore (ECBS).
If you disagree with your report
If you spot an error or disagree with some information in your credit report, write to the credit bureau about it. The credit bureau will:
- Speak to the bank that provided the data
- Post a notice in your credit report that the data is being disputed and is under investigation.
- Inform you of the outcome
- If any amendment is made to your credit report, send the revised report to all banks who have made enquiries on you in the past three months
Tips on keeping a good credit score
To maintain a healthy credit score:
- Pay all your outstanding monthly credit in full
- Always keep track of the payment due dates and remember to pay before then
- Avoid too many sources of credit. It's easier to keep track of your repayments when you have fewer credit facilities
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How does Credit Karma get your credit scores?
Credit Karma works with Equifax and TransUnion, two of the three major consumer credit bureaus, to give you access to your free credit scores and free credit reports. (Experian is the third major consumer credit bureau.)
Credit Karma can offer free credit scores and reports because we make money in other ways. For example, we use the information in your credit profile to make product recommendations that can help you save money. If you use these recommendations to apply for a product, Credit Karma may get paid by the bank or lender.
What kind of free credit scores does Credit Karma offer?
On Credit Karma, you’ll see credit scores and reports from Equifax and TransUnion, both using the VantageScore 3.0 scoring model. VantageScore was created in collaboration with all three major credit bureaus, and its 3.0 version is widely used in lending decisions today.
Does Credit Karma offer free FICO® credit scores?
Credit Karma doesn’t offer FICO® credit scores, which are calculated differently from VantageScore credit scores. While the three major credit bureaus collaborated to create the VantageScore model, FICO is a separate organization with its own scoring models.
The VantageScore and FICO modelsdiffer in several ways, but that doesn’t mean one is better or more accurate than the other. Lenders may rely on different scoring models when evaluating an application, and other considerations can factor in, too.
We recommend looking at your credit scores as a guide to your credit health rather than as a definitive number that determines whether you’ll be approved or denied for credit.
How often should you check your free credit scores?
Checking your free credit scores on Credit Karma isn’t a one-time set-it-and-forget-it task. Your scores may be updated frequently as your credit history changes, so checking them regularly can help you keep track of important changes in your credit profile.
Since you can check your free credit scores without hurting your credit, feel free to check as often as you like. If you see your credit scores steadily growing, it can help motivate you on your credit-building journey. And when you’re ready to submit a credit application, getting a better idea of your overall credit health beforehand can give you a better sense of where you stand.
Why your free credit scores from Equifax and TransUnion may be different
You may think that your VantageScore 3.0 credit scores from Equifax and TransUnion should be the same, but that’s not always the case.
Remember, VantageScore 3.0 is ultimately just a scoring model. The three-digit number it produces depends largely on the information that lenders report to each credit bureau.
When credit scores that use the same model differ between credit reporting bureaus, it’s typically because they don’t have the same information. Here are a few of the reasons you might see different credit scores.
- Your scores are from different dates. Different bureaus receive information from lenders at different times. If new information is accounted for in one credit score and not the other, the scores may differ.
- Your scores are calculated using different credit reports. It’s up to lenders to decide which credit bureaus they report your information two. Some report to all three major credit bureaus, while others report to only one or two. If your Equifax credit report has information that your TransUnion report doesn’t (or vice versa), your scores may differ.
- Your credit reports contain incorrect information. It’s possible that one or several of your credit reports contain errors. That’s why we recommend regularly checking your credit reports for errors that may affect your scores — anddisputing those errors, if need be.
It’s totally normal for your different credit scores to not be the exact same number at any given time. Lenders typically understand why your credit scores can differ — and they may also account for factors other than your credit scores when considering your application for credit.
How to read and understand your free credit scores
Your credit scores can be a useful reflection of your overall credit health. But to get the most out of your scores, you must first understand how they work, what they represent and what actually constitutes a good credit score.
VantageScore 3.0 credit score ranges
Credit score ranges vary by scoring model, and lenders can view ranges in different ways. VantageScore 3.0 credit scores range from 300 to 850. Think of them in terms of four basic categorizations: Excellent, Good, Fair and Poor. Here’s how they break down.
VantageScore 3.0 credit score factors
Different credit scores can have a lot in common under the hood, but each individual scoring modeluses its own combination of factors to determine your score.
Here are the major factors that determine your VantageScore 3.0 credit scores.
If you’re looking to improve your credit scores, consider which of these factors may be influencing your current situation most.
What other free tools does Credit Karma offer?
Credit Karma offers a number of tools that could help you keep track of your credit.
Free credit score FAQs
Does checking my credit scores hurt my credit?
Checking your free credit scores on Credit Karma doesn’t hurt your credit. These credit score checks are known as soft inquiries, which don’t affect your credit at all.
Hard inquiries (also known as “hard pulls”) generally happen when a lender checks your credit while reviewing your application for a financial product. This kind of check can negatively affect your credit.
Read more about the difference between hard and soft credit inquiries.
Is it really free to check my credit scores?
Like all the services on Credit Karma, checking your credit scores won’t cost you money. You may have to pay for credit scores elsewhere, but on Credit Karma it’s always free to check your credit scores.
Is my free credit score on Credit Karma accurate?
The free credit scores you see on Credit Karma come directly from Equifax or TransUnion. It’s possible that more-recent activity will affect your credit scores, but they’re accurate in terms of the available data.
If you see errors on your credit reports that may be affecting your credit scores, you have options to dispute those errors.
What do I need to sign up for a Credit Karma account?
In addition to creating a username and password, Credit Karma may ask you for your Social Security number. This information allows us to confirm your identity with the consumer credit bureaus to ensure that we show you accurate data.
You must be at least 18 years old to sign up for a Credit Karma account.
What’s the best site to get a free credit report?
The best site for free credit reports depends on what you need.
If you want to take a look at your credit reports from Equifax and TransUnion, you can do so on Credit Karma.
The Fair Credit Reporting Act entitles you to one free copy of your credit report from each of the three major consumer credit bureaus every 12 months. You can order them online at annualcreditreport.com.
Is it safe to check my credit score for free?
Checking your free credit scores on Credit Karma won’t affect your credit, and any attempts to monitor your credit with Credit Karma will not appear on your credit reports.
If you want to learn more about how Credit Karma collects and uses your data, take a look at our privacy policy.
You can also read Credit Karma’s security practices to learn more about Credit Karma’s commitment to securing your data and personal information as if it were our own.