Is an insufficient credit history or low credit score preventing you from qualifying for a loan or a decent interest rate?
If you use traditional tactics, it may take you several months of responsible financial behavior to raise your credit score to a favorable level.
Thanks to Experian®, one of the three leading credit reporting agencies in the U.S., you don’t have to take that arduous route.
The tool is known as Experian Boost™. could raise the credit scores of millions of consumers, especially those who don’t have a significant borrowing history.
It allows users to grant permission to the credit reporting agency to connect their bank accounts and gain access to their telecommunication and utility payments in a bid to update their FICO® score in real-time.
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How Experian Boost™ Works
In addition to offering free credit reports, Experian wants to help people improve their scores. Here’s a quick breakdown of how Experian Boost can help you.
The Basics of Experian Boost
To begin with, you won’t pay a dime to use Experian Boost. It’s a free tool geared to help individuals struggling with building credit.
If you are looking to boost your credit using the tool, you will have to allow it to scan your bank account transactions to identify mobile phone and utility payments. The information extracted by the tool will be reflected in your Experian credit report and be utilized when calculating various credit scores.
It is worth noting that Experian Boost is only interested in positive payment history. It doesn’t consider defaulted payments.
So, you don’t have to worry about missed cell phone or utility payments hurting your credit score. Once Experian Boost has identified utility and telecommunication payments, you will need to verify the data and confirm that you want it added to your Experian credit file.
Afterward, you will receive an updated credit FICO Score in real-time. The entire process takes about five minutes, boosting your credit score almost immediately.
Which Credit Scores Experian Boost Impacts
This tool works with the major credit scores that lenders use, namely:
- FICO 8
- FICO 9
- VantageScore 3
- VantageScore 4
However, if a lender uses credit reports from Transunion or Equifax to determine your eligibility for a loan or credit facility, Experian Boost won’t be of any help.
Also worthy of note is that Experian works with Finicity, a third-party firm that facilitates the transfer of data from consumers’ bank accounts to Experian’s credit report repository. You can get access to the tool by registering on Experian’s website.
How Effective Is Experian Boost™?
Experian Boost by the Numbers
Experian conducted a study to determine the effectiveness of Boost. Here are the findings:
- Two out of three: Average scores improved
- 10%: The number of consumers who previously had insufficient credit history became scoreable after using Experian Boost.
- 75%: Percentage of consumers with FICO Scores below 680 who had their credit scores improved with Experian Boost
- 14%: Percentage of consumers with a credit score of 579 and below who saw an improvement in their credit score to between 620 and 679.
- 5 to 15%: percentage who, depending on the credit level, moved into a better score category.
Experian Boost Results
These study findings serve to show that Experian Boost can boost your credit score, especially if you have a thin credit history. However, results may vary from one user to another.
Nonetheless, boosting that score could eliminate huge barriers for those looking to enhance their financial health. This tool is not only beneficial for consumers. It also helps lenders make more informed lending decisions after seeing consumers’ payment histories.
Can You Benefit From Experian Boost™?
Who Should Use Boost
According to Experian, Experian Boost would be ideal if you have less than five trade lines and with a credit score between 580 and 669.
However, any credit-active consumer can benefit from the score-boosting tool. In fact, at least 66 percent of consumers will see an improvement in their credit score after using Experian Boost.
Here are a few particular groups who should consider Experian Boost:
- Consumers with incomplete or subprime credit scores: These individuals can boost their scores when applying for loans and lines of credit.
- Young adults: Those looking for credit/loans without much to show in terms of credit history, will find Experian Boost exceptionally valuable.
- Responsible consumers: Those whose good financial habits aren’t reflected in their current credit report could be able to qualify for various credit and loan products.
How to Benefit From Experian Boost
To benefit from Experian Boost, you need to have an online bank account. You also need to allow Experian to scan it electronically. Experian will partner with a financial technology company, Finicity, to check bank statements for qualifying payments.
You should not worry about the security of your information. The system won’t alter your personal data as it uses read-only access. Also, keep in mind that you can revoke the permission granted to Experian at any time.
That means you are in total control and you can only grant access to your accounts only when you need to use Experian Boost.
Alternative to Experian Boost™
Another easy way to boost your credit score is through UltraFICO, which is also geared to help thin-file consumers.
How UltraFICO Works
By evaluating cash balances, UltraFICO is poised to help many consumers who otherwise don’t have, or are struggling to build, up credit. It is aimed at giving those who have no credit or insufficient credit the opportunity to build it by demonstrating they can manage their cash accounts.
Like Experian Boost, this platform also needs access to your bank account data to analyze your financial behavior.
UltraFICO doesn’t look at your telecom and utility payments. It looks at your savings balance and whether your checking account has overdrafts.
It is worth noting that this platform is being rolled on a smaller-scale pilot program first before it is fully launched in mid-2019. That means it could take a number of years for UltraFICO to be widely adopted by lenders.
Bottom Line: Experian Boost™ Review
Your credit score can have a significant impact on your financial health. It will determine whether you are eligible for a loan or credit product and the interest rate you will pay. With a low credit score, you may not be approved for a loan or credit product.
Experian Boost, developed by the credit reporting agency Experian, can help improve your score, particularly if you have not taken out substantial loans or had credit cards in your own name.
You will have to grant Experian permission to connect to your bank accounts and gain access to your telecom and utility payments. Then you can verify the data and confirm that you want it to be added to your Experian credit file. Afterward, you will receive an updated credit score in real-time.
With an improved credit score, you will have a higher chance of getting approved for a credit card or loan and save some bucks, thanks to lower interest rates.
If you’re looking for more ways to boost your credit score quickly, check out this helpful guide to get started.
–Disclaimer – Results may vary, see website for details.
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Experian Boost™ Review
Product Name: Experian Boost™
Product Description: Experian Boost™ is a unique product from Experian that allows consumers to potentially increase their credit scores by incorporating non-traditional payment data. By connecting their bank accounts, users can get credit for timely payments like utility bills and streaming services. This innovation offers a new way for consumers to have more control over their credit scores.
Summary of Experian Boost™
Experian Boost™ emerges as a pioneering tool in the credit industry, addressing the often-neglected aspect of non-traditional payment data in credit scores. Many consumers make regular, timely payments for services like utilities, phone bills, and even streaming subscriptions, yet these transactions typically don’t influence credit scores. Experian Boost™ bridges this gap by allowing users to link their bank accounts, identify these payments, and add them to their Experian credit report. As a result, some users might see an immediate boost in their credit scores. This tool democratizes the credit system to some extent, providing an avenue for individuals to positively impact their creditworthiness based on their real-world financial behaviors.
Cost and Fees
- Immediate Impact: Users can potentially see an instant boost in their credit scores after linking their eligible payments.
- No Additional Cost: Experian Boost™ is a free tool, allowing users to potentially enhance their credit without any financial commitment.
- User Control: It offers consumers a degree of control over their credit scores by choosing which payments to add.
- Beneficial for Thin Files: Individuals with limited credit history can use this tool to add more depth to their credit profiles.
- Experian Exclusive: The boost is applicable only to the user’s Experian credit report and does not affect scores from other credit bureaus.
- Not Guaranteed: While some users might see a significant uplift, others might experience minimal or no change in their scores.
- Data Access: Some users might be hesitant to link their bank accounts due to privacy concerns.
- Temporary Impact: If a user disconnects their bank account from the service, the boost and the associated credit history from the added payments might be removed.