What a credit score actually is (and why the number in the advert is not yours)Credit · 5 minute readThere is no single credit score. Different companies score you differently, and lenders mostly ignore the score and read the report underneath it.Credit is one of those words that gets used a lot and explained almost never. You are told to 'build your credit score' as if it were a game you could grind. Here is what is actually happening.There is no single scoreThree main agencies in the UK hold credit information: Experian, Equifax and TransUnion. Each has its own scoring system, and each score is a summary of the report they hold. Two agencies can hold slightly different information about you, which is why two scores can differ.The score you see for free is a rough guide to how a lender might read you. It is not a decision. Most lenders look at the report and their own affordability rules, not the headline number.What actually goes into the report

Whether you have paid borrowing on time, and whether you have missed payments.

How much of your available credit you are using. Using nearly all of a limit looks risky; using some of it and paying it off looks steady.

How long you have held accounts. Long, well-run accounts help.

How often you have applied for credit recently. Several applications in a short period looks like pressure.

Whether you are on the electoral register at your address, which is how lenders confirm you are who you say you are.

The boring truth about building itThere is no trick. Register to vote. Pay things on time. Do not take on borrowing you do not need. If you do borrow, pay it back on schedule. Check your report at least once a year, because errors are common and you are the only person motivated to fix them.Be careful with 'buy now, pay later'. It often does not report to credit agencies at all while you are using it — and then shows up as a missed payment when something goes wrong. The fact that it feels invisible does not mean it is harmless.A credit report is a record of behaviour, not a judgement of your character. That is genuinely good news: behaviour is something you can change.More free articles about money, work and business are at The Next Generation Blog.

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