SCHUFA credit score explained: how Germany's credit rating works

The SCHUFA credit score explained simply: it is a number that tells banks, landlords, mobile phone providers and online shops in Germany how likely you are to pay your bills on time. If you live in Germany, it can affect whether you get a flat, a loan, a phone contract or the option to pay by invoice.

Many newcomers to Germany only learn about SCHUFA when a landlord asks for a certificate. This guide explains what the bureau stores, how its score works, how to see your own data for free and what you can do to improve your rating. It is general information, not financial or legal advice.

What is SCHUFA?

SCHUFA Holding AG is a private credit reference agency based in Wiesbaden, founded in 1927. It is the best-known credit bureau in Germany and holds records on most adults in the country, as well as on millions of companies.

It works on a reciprocity principle. Banks, lenders, telecom providers, retailers and other partners report information about contracts and payment behaviour, and in return they can request credit information about applicants. SCHUFA is not a state authority, although it is subject to data protection law and supervision.

What data does SCHUFA store?

SCHUFA stores basic personal details such as name, date of birth and current and previous addresses. It also records credit-relevant information such as current accounts, credit cards, loans, leasing and mobile phone contracts, and certain inquiries made by companies.

Negative entries include payment defaults that meet legal conditions, such as an undisputed claim that remained unpaid after reminders, as well as public records like insolvency proceedings.

According to SCHUFA, it does not store information such as income, assets, occupation, marital status or nationality.

Your SCHUFA score reflects how long you have held accounts, how reliably you pay and how often you apply for credit.

How does the SCHUFA score work?

SCHUFA's current score uses a scale from 100 to 999 points, where a higher number means better creditworthiness. It replaced the earlier system of percentage values and multiple industry-specific scores with a single score that consumers and companies both see, although businesses have a transition period to adopt it.

The score is built from twelve criteria, each worth a certain number of points. They include whether there are payment defaults, the age of your oldest bank account and oldest credit card, how long you have lived at your current address, recent applications for accounts, cards and loans, the number and remaining term of instalment loans, whether you have a property loan and whether your identity has been verified.

SCHUFA groups the score into bands, from excellent at the top through good, acceptable and sufficient. People with recorded payment defaults receive no score and are rated insufficient.

How to check your SCHUFA score for free

Under Article 15 of the EU General Data Protection Regulation, you have the right to a free copy of the personal data a company holds about you. SCHUFA provides this free data copy on request, and it also offers a free online account where you can view your stored data and score and see how it is calculated.

Be careful not to confuse this with the paid credit report, which SCHUFA sells as a document to show landlords. For your own checks, the free options are enough. Review your data at least once a year and before any major application.

How long does SCHUFA keep entries?

Data is not kept forever. The main storage periods are:

• Settled payment defaults: generally three years, but deleted after 18 months if no further negative information has been reported in the meantime.
• Inquiries from companies for credit: 12 months.
• Repaid loans: three years after repayment.
• Opened insolvency proceedings and discharge of residual debt: longer periods apply, set by law and SCHUFA's code of conduct.

How to improve your SCHUFA score

There are no quick tricks, but steady habits help. Pay every bill on time and respond to reminders straight away. If you cannot pay, contact the creditor before the debt is passed on.

Keep long-standing accounts and credit cards rather than frequently opening and closing them, since the age of your oldest contracts counts. Avoid applying for many loans, cards or accounts in a short period. When comparing loans, ask banks for a conditions inquiry rather than a credit application, since condition inquiries must not be treated as loan applications.

Keep your address up to date, and check your data for errors, such as a loan you repaid long ago still listed as open.

How to correct a wrong SCHUFA entry

If you find incorrect information, you have the right to have it corrected or deleted. Contact SCHUFA in writing, explain which entry is wrong and include evidence such as proof of payment. It can also help to contact the company that reported the data directly.

If the problem is not resolved, you can turn to SCHUFA's ombudsman service, a consumer advice centre or the data protection authority responsible for SCHUFA.

Frequently asked questions

Your SCHUFA score is not a mystery. It reflects how long you have held accounts, how reliably you pay and how often you apply for new credit. Check your data for free at least once a year, correct mistakes promptly, pay on time and avoid unnecessary applications, and your rating will usually take care of itself.

How we research: Guides are written from established sources and checked for accuracy. They are general information, not professional advice.