Borrowers have 49 different credit scores, not just one

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  • NedGrimley Brigham City, UT
    Aug. 30, 2012 10:48 a.m.

    Now, should there be more government regulation enacted because lenders decide to take advantage of the proven historical metrics used in scores, and therefore charge a higher interest rate to people with less positives scores? I don't think so. Borrowing money is a decision we individually make on our own and we ought to expect those who lend will do so in the most advantageous way for them. That's how they put food on their own table. If you can't make the payment, don't borrow the money.

  • NedGrimley Brigham City, UT
    Aug. 30, 2012 10:42 a.m.

    Article: "Lenders use FICO’s software to receive credit reports, but the software has been updated a number of times and many agencies haven’t updated. Over time, this has added to the total number of scores per borrower."

    I do believe this is an innacurate statement. There are multiple scores because there are multiple metrics used to produce scores. The article referenced it, but didn't accurately portray it. There are scores produced specifically for someone applying for a credit card, a different one for an auto, another for a mortgage, another to determine the propensity of the applicant to file bankruptcy, etc. The lender determines which score they want to view andd use internally in their decision making. The actual score is generated from the credit bureau, not from some lenders internal software. The process of generating the socre involves very complicated formulas and historical validations.

    There are also proprietary scores built by the individual credit bureaus themselves. Not every score is a "FICO" score. FICO just happens to be the nom du jour attached to credit scores. (Like referring to tissues as a "kleenex")

  • My2Cents Taylorsville, UT
    Aug. 30, 2012 5:07 a.m.

    Does this revelation qualify debt and credit as economic and consumer enemy number one yet?

    Like I have always said, interest rate is the least of the cost in debt/debit and credit cards. I have been struggling for 30 years why people are giving up most of their take home pay to debt just in fees and user charges? I mean they are taking a pay cut just to have debt and a credit card with their employers.

    This revelation should also qualify some financial legislation to protect consumers from the credit bureaus and card companies manipulation consume debt and credit report to raise their fees and charges by manipulating and falsifying their own reports to the credit bureau.

    It's time to shut down the credit bureaus and disolve credit cards.