When a credit report shows "insufficient credit," it means there is not enough credit history or activity to accurately assess an individual's creditworthiness and generate a score. This can happen for several reasons:
1. Limited Credit History
The individual has no prior credit history, making it impossible to generate a reliable credit score.
Common for young adults or those who have never used credit cards, loans, or other credit products.
2. Thin Credit File
A "thin credit file" means the individual has very few credit accounts or limited credit activity on their report.
Without enough credit data, the system cannot determine a credit score.
3. New Credit Accounts
TransUnion requires at least 6 months of credit history to generate a score.
If an individual has recently opened accounts but their oldest account is less than 6 months old, their credit report may show "insufficient credit."