ClearScore

ClearScore: Should You Use It?

The regular credit holder would value reliability more than anything else as far as their credit reports are concerned. After all, you would rather hear the true state of your credit activities from a source that is accurate and comprehensive.

There are tons of sources out there that offer credit reports for you to use as a reference and one of these is ClearScore. Is the service worth subscribing? Would you get an unbiased view of your entire credit behavior from the report score that they offer? It’s time to find out.

Who are ClearScore?

Clearscore are an auxiliary credit profile provider that operates in the UK as well as some other territories. Concept-wise, they are not that different from other providers in the sense that they operate by gathering financial data about you and creating a report with a fixed score for you to use however you please.

However, what makes ClearScore different from others is the fact that it is completely FREE. Up until they were formed, most people had to pay just to see what their credit reports contain. To reiterate not for a limited trial period..but just..free..period.

They feel that having to pay just to see information that would heavily impact how you could use your credit is not that fair. A constant access to that information so you could make better financial decisions should not be hidden behind a paywall. As such, like many social media sites out there, ClearScore aims to provide its services for free for as long as it exists.

Aside from the lack of a subscription fee, ClearScore updates your score every month or so as long as new information about your credit behavior shows up. Subscribers can see their reports when they need and wherever they need. Just do not expect to see changes in your score whenever you log in.

The ClearScore business model

At this point you may be wondering that if they are going to the trouble of supplying you access to your credit score for free, just how long will they stay in business?  A good question. First to note is that ClearScore is owned by Experian and its free credit report checking service is powered by data it receives from Equifax. They make money by introducing users to credit cards and loans that might suit them. There is a section called ‘Offers’ which shows users financial products selected for them based on their credit history and borrowing behavior. When someone takes out a product via ClearScore on one of these suggested products they receive a commission.

What is Contained in your Report?

How Clearscore goes about preparing your credit report is not completely different from how other agencies would do theirs. Simply put, they scour the entire country for any information that can establish how you behave as a credit holder.

Once that information is gathered, they then begin to process and interpret the data which determines the grade or score that they offer to you.

So, this does begs the question: what does ClearScore look for when creating a credit report for you? To answer that, you must understand that your credit report is a comprehensive history of how you have been behaving as a credit holder for the past few years. In the agency’s report, such history will cover a period spanning as much as 6 years.

Every credit report prepared by the agency will always contain the following informing:

  1. Basic Information – This includes your name, date of birth, most recent address, previous addresses, and any financial associations you have established with other persons.
  2. Electoral Status – Being registered as a voter in your area does indicate a strong tendency towards staying in that place for the next few years. Being “mobile” or having to move from one address to another frequently tends to give a bad impression among reporting agencies.
  3. Judicial Decisions – Have you ever had a run-in with the law? This does not necessarily mean that having a criminal record will lower your credit score considerably per se. What the agency looks for is any county court judgement rendering that you have to perform a specific action for the fulfillment of a financial obligation.

Also, being declared bankrupt or having to undergo a Voluntary Arrangement with a creditor tends to considerably impact your overall score with ClearScore.

  • Credit Account Information – This includes any amount that you owe from a creditor and whether or not you have paid the same on time. This also includes the age of your account and your credit history which starts the moment you opened your first credit account.

Alternatively, this means that every account that you defaulted on will be included here. All in all, this is one of the most important aspects of your ClearScore credit report as your ability to clear items in your debt list will determine how good of a score you are going to get.

  • Fraud In this aspect, ClearScore will check whether or not fraud has been committed in your name or you yourself committing fraud using someone else’s name.

The reason for this is simple: Fraud is the crime that directly affects credit activity.

  • Searches – Every time that you apply for a loan or any financial product, the creditor will do a hard search on you. This means that they pull up your credit report from an agency. Normally, a lot of hard searches performed in a short period of time would indicate that you are applying for multiple loans.
  • Utility Payments and Subscriptions – In here, the agency looks at your ability to pay “special” types of credits like your bills for utility services and your monthly subscriptions. If you are renting property, any amount that you have yet to pay to the landlord will be included here as well.

ClearScore also has its own set of values placed for each data that they use to compile your grades with. That means that there will be data regarding your activities that will impact your score more than the others.

Do not worry, though, as ClearScore also explains to you why they assigned you this score and in which part you need to work more in order to improve your score in the next report.

What’s Not Included?

Even as ClearScore aims to provide you with a comprehensive look at your credit history, there are some information that it would not include, let alone look for, when compiling your score. These include:

  • Your salary
  • Loans that you secured while still a student
  • Medical History
  • Any criminal activity that does not involve or directly related to Fraud
  • Any parking fine you accumulated
  • Personal information like your gender identity, ethnicity, religion, and etc.

There are two reasons why they are off-limits to credit reporting agencies. First, they do not necessarily tell anyone what your actual credit behavior is.

Second, the information contained within these sources are highly confidential. There are rules in the UK that prevent any agency from prying further into your personal life regardless of how pressing the purpose.

Is the Service Reliable?

The short answer is yes. The agency makes sure that the information being presented on your credit report is highly accurate for most of the time.

However, the key phrase here is “most of the time”. There will always be that instance when the data being presented does not accurately reflect your activities. Worst, they would negatively impact your overall score.

Before anything else, it is important that you remember that the UK has three credit reporting agencies operating in it: Equifax, CallCredit, and Experian. For ClearScore, they use the information provided to them be Equifax.

Equifax, in turn, gets their information from banks, lenders, credit card companies, utility companies, and every other business out there that will potentially interact with you. It cannot be avoided, then, that there will be details lost or misinterpreted from one data source to another.

But do not worry, though. If you do find something that you believe to be a discrepancy in your report, ClearScore does allow you to contest the data. This prompts the agency to double-check on their sources and perform amendments whenever necessary. You can be certain that the amendments will be performed as soon as your claim is validated.

One other factor that you have to consider is that no one has a single credit score. Even if most reporting agencies use almost the same set of information, how they treat the data will be different.

This means that  there is a chance that you will get a completely different score from ClearScore compared to others. Whether or not that works to your favour is dependent on the  value the agency puts on certain information that they have gathered about you.

Is the Data Safe?

Of course, one concern that you might have with ClearScore is the security of the information that they provide to you. After all, if you have free access to your credit data, who else has the same?

You can be certain that your data as compiled by the agency is completely private. Whenever any person requires your credit information from the agency, they would have to get your permission first. This only means that nobody else will be able to know of your credit report score without going through you first.

In a Nutshell

Without a doubt, ClearScore remains a fairly reliable reporting service with a non-intimidating (and non-existent) price to access. However, you have to remember that they only rely on what Equifax is telling them to provide you with a score.

That can only mean that whatever score you get from ClearSCore may or may not give a comprehensive view of your viability as an investment option for lenders. There may even be errors committed in the data they present to you although this can be easily amended by you contesting the report.

Despite this, ClearScore remains a fairly reliable source of information regarding your credit activities. With their score as your reference, you can make better-informed decisions to make your standing with your would-be creditors all the more favorable to you. D