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Highlights: It’s completely normal for your credit scores to change over time. Information in your credit reports is updated as it is reported to the three nationwide consumer reporting agencies (CRAs). A variety of factors can cause changes in your credit scores. If you’re tracking your credit scores over time, you may notice the three-digit numbers may change, even if the most recent score is generated by the same consumer reporting agency as previous scores. It’s completely normal for credit scores to change. But why does this happen? Why do your credit scores change? Your credit scores are a snapshot in time, and they change based on your credit behaviors and the information on your credit reports. As new data is reported by lenders, collection agencies and other sources, your credit reports are updated, and the information across your various credit reports may be different depending on what is reported to each of the three nationwide CRAs (Equifax, TransUnion and Experian). Factors in calculating a credit score Lenders use many different scoring models. However, in general, credit scores are calculated by considering the following factors: Payment history. Your payment history, including on-time, late and missed payments, often accounts for the largest portion of your credit history. Used credit vs. available credit. Also known as your credit utilization rate, this ratio refers to the amount of credit you’re using compared to the total amount available to you. Lenders and creditors typically like to see you use 30 percent or less of your total available credit. Types of credit accounts. Lenders like to feel confident that you can handle a mix of different types of credit. This includes revolving debt, such as credit cards, and installment loans, such as mortgage, student, auto and other types of loans. Length of credit history. Credit scoring models often consider the age of your oldest credit account and view longevity favorably. New credit. Lenders may also take into consideration any accounts you’ve opened recently. Changes to these and other factors on your credit report are what result in adjustments to your credit scores. That data could also include balance changes, the opening of new accounts, payments on existing accounts or closed accounts falling off your credit report after a period of time. If you check your credit score in January and then again in March, for instance, the number may have changed based on account activity reported to the three nationwide CRAs during that time. It’s important to remember that credit scoring models vary. One model may place more importance on payment history, while another might emphasize something else entirely. So, it’s not unusual for your credit scores to vary based on the scoring model used. Reasons your credit scores may have changed Multiple factors might cause a sudden change in your credit scores, many of which can occur without any action on your part. If your credit score has recently changed, consider the following: Credit scores may vary across the CRAs. While a credit score from one CRA may rise and fall, you may also see differences in credit scores furnished by the other two agencies. Some lenders and creditors report to all three of the nationwide CRAs, but others may report to only two — or none at all. That means the information that each agency uses to calculate your credit score may differ. In addition, the three nationwide CRAs and other credit reporting entities use different scoring models to calculate credit scores, so even if your data is the same across the board, your credit scores may differ. Some lenders use industry-specific credit scoring models. In addition, some lenders may use a credit scoring model that’s specific to a certain industry, which may not generate the same score you receive from one of the three nationwide CRAs. For instance, if you’re buying a car, the lender may look more closely at your payment history regarding auto loans. While credit score fluctuation is normal, it’s important to ensure the changes don’t result from inaccurate or incomplete information on your credit reports. Therefore, it’s a good idea to regularly review your credit reports from the nationwide CRAs. The passage of time affects your credit scores. Even if there are no changes to your credit reports, the passage of time could cause fluctuations in your credit scores. If you have a late credit card payment, for example, its effect on your credit scores may diminish over time. That doesn’t mean that it’s okay to make a late payment. One of the best habits you can get into is paying your bills on time every time. Your recent payment history may affect your credit scores. Making payments on credit accounts is a common cause of fluctuation in credit scores, as payment history is often the largest factor used to calculate credit scores. If you make payments on your credit cards or installment loans, your payment history may be reported to one or more of the three nationwide CRAs, which may cause changes in your credit scores. Charging or paying down debt may affect your credit scores. Your debt to credit ratio (also known as your credit utilization rate) is the percentage of available credit you’re using. It also factors into credit scoring and may cause your scores to fluctuate. For instance, if your credit card balances change month to month, causing the amount of available credit you’re using to move up or down, you may see fluctuations in your credit scores. Payments may also impact your debt to credit ratio, leading to changes in your credit scores. How often are credit reports and credit scores updated? When it comes to your credit reports, creditors usually report information to the three nationwide CRAs monthly. However, each creditor may report the information at a different time. Similarly, you can usually expect your credit scores to update at least once every month. However, it’s possible your scores may update more frequently depending on how actively you use your credit accounts. You should also note that credit scores refresh at different

Study shows liquidity falling, and, for some, credit card balances rising As pandemic-related government relief programs and forbearances fall farther behind in the rearview mirror, a new study from TransUnion (NYSE:TRU) found that many consumers are reverting to traditional payment patterns. The information is particularly important in today’s consumer credit market as pressures from high inflation and rising interest rates may further impact the delinquency landscape. At the mid-point of 2022, 500 million bank-issued credit cards were in the marketplace, up from approximately 465 million one year earlier. In that same timeframe, serious delinquency rates rose to 1.57% and average balances per consumer increased to $5,270, up significantly from 2021, but still below pre-pandemic levels. To better understand consumers today, TransUnion’s study, “Detecting Early Indicators of Liquidity Shortage in Managing Card Portfolio,” tracked the liquidity situations of 5.9 million consumers from Q3 2019 through Q4 2021. The report compared two groups of consumers; the study group, which started the study current on card payments, but which fell more than 90 days past due on payments at some point over the course of the analysis, and the control group, which remained current throughout.  “ As consumers, in particular those with credit cards, face challenges from rising interest rates, high inflation and other factors, it’s critical for lenders to better understand the predicament of their customers. It’s important for lenders to understand changes to consumer payment behaviors sooner so they can work with consumers on payment plans or other programs that will prevent serious delinquencies down the line. Paul Siegfried, senior vice president and card and banking business lead at TransUnion „ Tweet The study examined how early changes in payment behaviors can be identified in the weeks and months leading up to a first serious bankcard delinquency and whether or not risk levels could be differentiated based on these changes in liquidity signals. In the early months of the pandemic, when many consumers saw a large flow of liquidity from external sources, such as from pandemic-related government relief programs, balances decreased and delinquencies declined widely among consumers. However, by Q4 2021, consumer behavior began to revert and while those in the control group began paying more towards their card balances, those in the study group began paying less and in many cases, falling behind. Over the course of the study period, total credit card balances and total utilization remained relatively flat among the control group, while both saw significant growth among the study group. And while consumers in the control group made larger payments to their cards relative to the minimum due, payments from consumers in the study group shrunk in size. Study findings also showed that the deterioration of the liquidity of those consumers who eventually fell 90+ days behind occurred as soon as 9-12 months prior to severe delinquency. Consumers with Increased Credit Card Balances and Utilization Are Higher Delinquency Risks Cohort Median Total Bankcard Balances per Consumer Median Bankcard Utilization per Consumer Median Quarterly Total Aggregate Excess Payment Per Consumer Study Group +34% +29% -49% Control Group +2% -2% +19% VantageScore ® 4.0 risk ranges, Prime = 661-720; Q3 2019 through Q4 2021 “Differentiating risk levels of bankcard consumers within each traditional credit tier can be especially important for lenders. By identifying these risk segments based on liquidity attributes, lenders can better evaluate their current account management strategies and credit line increase programs to grow low-risk consumers while mitigating loss from high-risk segments,” concluded Siegfried.   To learn more about the findings of the study and what can be done to mitigate delinquency risks, visit here. More information on how TransUnion CreditVision helps lenders better understand consumer credit behavior can be found here. For tips on how utilization rate, payment history and other factors can impact consumers’ credit, visit TransUnion’s blog on how to use a credit card responsibly.

Q3 2022 TransUnion Credit Industry Insights Report explores latest credit trends The third quarter of 2022 saw more consumers turning to unsecured personal loans and credit cards as a means to help stave off the financial pressures brought on by inflation. TransUnion’s (NYSE: TRU) newly released Q3 2022 Quarterly Credit Industry Insights Report (CIIR) also shows that while delinquencies for most credit products remain in line with pre-pandemic levels, they continue to rise from the very low levels seen in 2021, particularly among subprime segments of customers.  Credit card balances continue to grow, with bankcard balances reaching a record high of $866 billion in Q3 2022, which represents a year-over-year (YoY) increase of 19%. This increase was heavily driven by growth among Gen Z and Millennial borrowers, among whom balances grew by 72% and 32%, respectively. Private label balances are also at a record high, up 7.3% YoY. Private label total and average credit lines have also increased to record highs, as have average number of accounts per consumer. Delinquencies have also risen and in Q3 2022 were slightly higher than the level seen pre-pandemic in Q3 2019. Bankcard charge-offs, for now, continued to decline, down for the sixth consecutive quarter. Charge-off balances are showing an upward trend among private label after seven consecutive quarterly declines. Unsecured personal loans have seen record growth in originations and balances in recent quarters. This growth has been fueled, in part, by significant increases in lending to below prime risk tiers. This increase, combined with a general deterioration in the financial health of subprime consumers as a result of elevated inflation, has led to an increase in delinquencies, which have now surpassed pre-pandemic levels. As lenders navigate increasing delinquencies, a high inflation environment, capital constraints, and a potential recession, lending to below prime risk tiers is likely to slow down in the last two quarters of 2022. Loan Growth and Balances Rising for Credit Cards and Unsecured Personal Loans Key Metrics Q3 2022 Q3 2021 Number of Credit Cards 510.9 million 474.2 million Average Credit Card Debt per Borrower $5,474 $4,857 Consumers with Access to a Personal Loan 22.0 million 19.2 million Average Personal Loan Debt per Borrower $10,749 $9,387 TransUnion’s Credit Industry Indicator (CII) was relatively stable between Q2 and Q3 2022, ticking up one point to 120, but dropped from the prior year level of 126 in Q3 2021, largely driven by the rising delinquencies across many product categories. The CII is a quarterly measure of depersonalized and aggregated consumer credit health trends that summarizes movements in credit demand, credit supply, consumer credit behaviors and credit performance metrics over time into a single indicator. Examples of data elements categorized into these four pillars include: new product openings, consumer credit scores, outstanding balances, payment behaviors, and 100+ other variables. To learn more about the latest consumer credit trends, register for the Q3 2022 Quarterly Credit Industry Insights Report Webinar. Read on for more specific insights about credit cards, personal loans, auto loans and mortgages. Largely driven by non-prime growth and a high inflation environment, credit cards see highest balances on record Q3 2022 CIIR Credit Card Summary Bankcard originations increased to 21.3 million in Q2 2022, a 10.7% growth YoY, with significant growth seen in the subprime (+12.5%) and super prime (+15.2%) risk tier segments (originations are viewed one quarter in arrears). Private label originations increased to 12 million, with 8.4% growth YoY. The subprime share of overall private label originations increased to 22.5%. Total bankcard balances in Q3 2022 increased to a record level, $866 billion, representing a 19% growth YoY, driven by card use across all risk tiers and recent high origination growth in non-prime segments. Total private label balances increased 7.3% YoY, driven by subprime consumers, while average consumer balance reached the highest point since 2Q 2020. Total available bankcard credit lines and average credit lines per consumer are at an all-time high, with consumers having access to a record number of cards in their wallets, again driven by growth in prime and below segments. The 90+ delinquency rate increased to 1.94% in Q3 2022, which was slightly above the 1.82% seen in Q3 2019. Private label 90+ DPD delinquency rate increased 56bps YoY to 1.52%. Total private label charge-off balances have started showing an upward trend after a seven consecutive quarter decline. Instant Analysis “In this inflationary environment, consumers are increasingly turning to credit, as evidenced by the record total bankcard balances this quarter. This is particularly true among the subprime segment of consumers. Delinquencies are rising, which is to be expected given the increase in consumers getting access to credit, many for the first time. However, the numbers remain in relative alignment with historical pre-pandemic levels of 2019. We are likely to see continued growth in credit card usage as increased interest rates and inflation continue to put pressure on consumers while employment numbers remain strong.” – Paul Siegfried, senior vice president and credit card business leader at TransUnion Q3 2022 Credit Card Trends Credit Card Lending Metric Q3 2022 Q3 2021 Q3 2020 Q3 2019 Number of Credit Cards 510.9 million 474.2 million 451.9 million 441.9 million  Borrower-Level Delinquency Rate (90+ DPD) 1.94% 1.13% 1.23% 1.82% Average Debt Per Borrower $5,474 $4,857 $5,068 $5,658 Prior Quarter Originations* 21.3 million 19.3 million 8.6 million 16.5 million Average New Account Credit Lines* $5,021 $4,200 $4,001 $5,295 *Note: Originations are viewed one quarter in arrears to account for reporting lag. For more credit card industry information, click here for episodes of Extra Credit: A Card and Banking Podcast by TransUnion. Personal loan consumers reach a record 22 million as below prime balances continue to grow Q3 2022 CIIR Personal Loan Summary As of Q3 2022, 22 million consumers had an unsecured personal loan, the highest number on record, highlighting the expanding acceptance and usage of this product type by consumers.  Originations in Q2 2022 (viewed one quarter in arrears) grew 36% YoY to reach six million, with all credit tiers experiencing 30%+ growth.  Consequently, total personal loan balances

Equifax understands that consumers have questions about their credit score and the potential effect of the coding issue that took place between March 17 and April 6, 2022. We take this issue seriously and regret that it occurred. While a number of news outlets have reported on this issue, we want to clarify the conflicting information that has appeared in news reports to ensure accuracy of information. Here’s what you should know: Information in consumer credit reports was not affected. Equifax advises all consumers to regularly check their credit reports as part of their regular personal finance routine. However, this coding issue did not affect the information in consumer credit reports. Equifax credit reports can be received with a free myEquifax account. The three nationwide credit reporting agencies are offering free weekly credit reports to consumers through the end of 2022. Consumers can access their free weekly credit reports from each of the three credit reporting agencies at www.annualcreditreport.com. The issue took place between March 17 and April 6, 2022. The coding issue was limited to a three-week period of March 17 through April 6, 2022 and is not ongoing. A fix was put in place on April 6. Scores have been updated. Equifax has been providing lenders with updated scores and continues to work with them closely to best meet the needs of consumers. While some media reports have encouraged consumers to re-check their Equifax credit score, we can confirm scores were updated on April 6, when the issue was fixed. The updated scores provided to lenders are representative of the March 17 through April 6 time period. Some lenders used the data to create their own scores, and they have been provided with updated data. Equifax has been providing lenders with updated scores. Lenders use unique underwriting rules to evaluate risk and determine whether, and at what rate, to extend credit. These rules often include credit scores (sometimes from multiple sources), and may include other factors such as: debt-to-income ratio, savings, employment status, recent applications for loans or credit, and if a consumer has tax liens or declared bankruptcy. Score shifts do not always result in changes to credit decisioning. As part of our commitment to resolving this issue, Equifax has conducted an analysis of credit scores used for consumers seeking credit during the time period of the issue. Our analysis indicates that for those consumers there was no shift in the majority of scores during the three-week timeframe of the issue. For those consumers that did experience a score shift, initial analysis indicates that only a small number of them may have received a different credit decision. Our data shows that less than 300,000 consumers experienced a score shift of 25 points or more. While the score may have shifted, a score shift does not necessarily mean a consumer’s credit decision was negatively impacted.  If you attempted to obtain credit between March 17 and April 6, 2022, and think your decision may have been impacted, Equifax advises that you reach out to the lender for more information.  Again, we know consumers and businesses depend on our data and we do not take this issue lightly.