Do Other Countries Have Credit Scores?

Of course, you know that a credit score is an important part of every American's life. Good credit helps borrowers get the best bad credit loan offer at the lowest interest rates. Even though you know how a credit score works in the USA, what about other countries? What countries use credit scores? Are credit scores international? Are credit scores only in America?

Since many people have been interested in these questions lately, it is time to answer them. Moreover, if you want to move one day, understanding how credit works in other countries can be valuable information for you.

The United States Credit Score And How It Works

Before talking about other countries, let's remember how credit scoring works in the United States. It's actually quite simple: lenders and other people you work with report your financial transactions to one of three major credit bureaus. The details of your transactions can be either positive or negative, which is why your credit score depends.

Next, the credit scoring company (the most famous is FICO) examines the data and makes a numerical score. Thus, you need a credit account to get a loan or credit card. When submitting an application, the lender will check the information stored in the credit bureau's files and your credit rating. Based on this data, he will decide whether to provide you with a loan.

Credit Score In Other Countries

Do credit score exist in other countries? What countries have credit score? Is the U.S. the only country with credit scores? In fact, each country has its own way of assessing creditworthiness. Typically, this includes the main aspects of the loan, for example:

  • Who can enter information on your credit report
  • How many credit bureaus are there in the country and are there any
  • Who owns credit bureaus
  • How long does the information stay on the credit report?
  • What types of information are recorded in the credit report and so on.

However, many countries such as Canada, Japan, UK, Spain, Australia and Germany use a credit score that is more or less similar to an American one.

Does Canada Use Credit Scores?

Yes, Canada uses a credit score. Moreover, the credit rating system is very similar to the United States, however Canada has only two major credit bureaus. Also, you should pay attention to the fact that in the USA the credit rating ranges from 300 to 850, and in Canada from 300 to 900.

Does the UK Have Credit Scores?

Yes, the United Kingdom also has a credit system, and it is also similar to the United States. Currently, there are three main credit agencies in the UK: Experian (which uses a score of 0 to 999), Callcredit (which provides a score of one to five), and Equifax (which uses a score of 0 to 700). Credit in the UK also depends on such important factors as the use of the credit, age of accounts, and payment history.

Credit Score Europe

Most likely, you understand that in Europe people have a completely different attitude to the debt since it is normal there to rent a house all their lives and avoid loans. Thus, people in Europe do not accumulate debts, so the lending criteria are also stricter. Of course, the process of lending in Europe is different from America, but there is still a centralized European record for those people who miss or late payments.

Lending in Europe works as follows: each loan application is considered based on many factors. This includes marital status, current debts, current wages, residence status, and more. However, you should note that if you do not make timely payments, the lender puts you in a special file which is available to all lenders in most of Europe. Thus, in the future, you will have big problems with obtaining a loan.