Let’s start here. A credit score is a measure of how likely it is that you will default on the specific credit that you are applying for. The scoring models are based on statistical analysis of an aggregate of everyone who has ever obtained credit. The model looks at the credit histories of those who have defaulted in the past on that particular type of credit, and looks for common threads. If your credit history for that type of loan is similar to other borrowers who have defaulted on that type of loan, then your score will be lower.

For instance, someone who has defaulted on a car loan in the recent past and had their car repossessed is likely to have a very low score on a credit report run for a car loan. It won’t help their score for a mortgage loan application either, but if they’ve paid their mortgage on time and as agreed, it might not hurt them nearly as much as it would for the car loan. Similarly, it might not affect their score on a credit card application as much, if they have paid credit cards as agreed.

What is a Credit Agency versus a Credit Bureau?

Before anyone can run your credit, they must contract with a credit agency. The credit agency queries the credit bureaus’ computers to get your credit history and score. The credit agency thus becomes the gate-keeper for credit data and rules. One of the rules is that when a lender (like a mortgage broker) signs up with a credit agency, we agree to run credit reports only on certain conditions:

• We must have your express written permission
• Our request must only be for the purpose for which we are authorized. (In our case, mortgage lending.)
• The credit report belongs to the credit agency, not us and not the borrower.
• We may not divulge any information to anyone without a legitimate interest. (Such as a wholesale lender to whom we want to submit your loan.)

  

I think you get the idea. The salient point here is that when we run your credit report, the bureaus know that we are doing so in conjunction with an application for a mortgage, so the score they produce reflects how likely it is that you will default on a mortgage.

It should be clear by now that you’ll have different scores, then, depending on who runs your credit and why. So when someone tells me their credit score is 800, I know that they are probably close, but also that when I run their credit, it’s very unlikely that it will be exactly 800.

So What is a Credit Score?

Put as simply as possible, your credit score is a measure of how likely it is that you will default on a particular type of credit for which you have applied.

Casey Fleming, Mortgage Advisor and Author of The Loan Guide (2014) and Buying and Financing Your New Home (2023) and Insider’s Guide to Reverse Mortgages (2025)

NMLS 344375 / DRE 00889527

About Casey Fleming: Casey Fleming is a veteran mortgage advisor (NMLS 344375, CA DRE 00889527) and Author of The Loan Guide, Buying and Financing Your New Home, and The Ultimate Guide to Reverse Mortgages. He writes extensively about real estate finance, the real estate market, and the relationship between economics and finance. He advises clients throughout California, and is based in the heart of Silicon Valley.  He writes articles regularly for several online publications, is a subject-matter expert for two prominent finance-related sites, and is regularly quoted in articles for many other publications.

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