topic Re: FICO Score Variations from MyFICO.com to Broker's Report in General Credit Topics

FICO Score Variations from MyFICO.com to Broker's Report

RonBurgundy — Tue, 25 May 2010 18:19:12 GMT

I checked my scores on this web site before applying for a car loan and a mortgage. They were 719 (TU) and 712 (EQ). I thought these were good enough to move forward with my loan applications, so 3 days later, I did. You can imagine my surprise when the scores that came back from the mortgage broker were over 50 points HIGHER. The card dealership's FICO scores were nearly 70 points higher! How is this possible? Not that I'm complaining about having a higher score than I was told, but I thought the scores I paid for on MyFICO.com were real and accurate. Does anyone know why the extreme variation?

Re: FICO Score Variations from MyFICO.com to Broker's Report

tstinn — Tue, 25 May 2010 18:29:25 GMT

Did you have any Authorized User tradelines on your credit report? The same thing happened to me and we figured out that MyFICO.com's "consumer credit scoring model" excludes the consideration of AU lines from the score when calculating credit scores, but that all lenders give you a credit score benefit for having them, as long as the history is positive.

It has something to do with the Equal Credit Opportunity Act requiring that all lenders consider AU lines in the score, but MyFICO.com does not have to abide by that because they are not a lender.

Re: FICO Score Variations from MyFICO.com to Broker's Report

StacyMoore — Tue, 25 May 2010 19:19:57 GMT

I am a mortgage broker and have noticed a similar trend, as well. Several of my clients have utilized "credit piggybacking" services and have noticed the score increase on other credit reporting web sites, but not on MyFICO.com or Equifax.com, even though we see the change on our broker generated credit reports/scores.
My guess is that MyFICO.com does not want to show the benefit to the credit score when adding AU lines. Anyone else out there know for certain?

Re: FICO Score Variations from MyFICO.com to Broker's Report

RonBurgundy — Tue, 25 May 2010 19:26:32 GMT

Yes. I just double checked and 2 of my girlfriend's credit cards are on my report. That must be the reason...thanks for your help in getting to the bottom of this!

Re: FICO Score Variations from MyFICO.com to Broker's Report

Revike — Tue, 25 May 2010 20:02:44 GMT

RonBurgundy wrote:
I checked my scores on this web site before applying for a car loan and a mortgage. They were 719 (TU) and 712 (EQ). I thought these were good enough to move forward with my loan applications, so 3 days later, I did. You can imagine my surprise when the scores that came back from the mortgage broker were over 50 points HIGHER. The card dealership's FICO scores were nearly 70 points higher! How is this possible? Not that I'm complaining about having a higher score than I was told, but I thought the scores I paid for on MyFICO.com were real and accurate. Does anyone know why the extreme variation?

What scoring models were the source of the scores pulled by the broker? MyFico provides the TU'98 and EQ Beacon 5 version scores. Many lenders use the TU'04 version, and there are other '08 and '09 versions that have been released but are not widely used.

Auto lenders often use industry-specific scoring models or other models that are different from the TU'98 and EQ Beacon 5 models. It's not surprising at all that a score pulled by an auto lender is significantly different.

Also, credit reports are continually updated. There might have been a positive event during the 3-day gap which could have contributed to part of the difference in scores.

TU'98 and EQ Beacon 5 do count AU tradelines. Versions released after '08 claim to treat AUs differently, but there has been some skepticism of that claim.

There isn't a "lender" version and a "consumer" version of the TU'98 and EQ Beacon 5 models. If a score is pulled from MyFico on the same day that a score is pulled by a lender, and the same scoring model is used, the scores will match. There have been many confirmations of an exact match from people whose lenders used those two versions. When the EX score was still offered to the public, there were many confirmations that all three scores from MyFico matched the lender scores when pulled at the same time. Unfortunately, because the majority of lenders use TU'04 these days, it is becoming more common that the EQ Beacon 5 score is the only score that consumers can purchase from MyFico or Equifax, and reasonably expect the majority of mortgage lenders to pull as well ...

Re: FICO Score Variations from MyFICO.com to Broker's Report

Lel — Tue, 25 May 2010 19:50:45 GMT

RonBurgundy wrote:

I checked my scores on this web site before applying for a car loan and a mortgage. They were 719 (TU) and 712 (EQ). I thought these were good enough to move forward with my loan applications, so 3 days later, I did. You can imagine my surprise when the scores that came back from the mortgage broker were over 50 points HIGHER. The card dealership's FICO scores were nearly 70 points higher! How is this possible? Not that I'm complaining about having a higher score than I was told, but I thought the scores I paid for on MyFICO.com were real and accurate. Does anyone know why the extreme variation?

For the mortgage loan application, were both your TU and EQ scores considerably higher? Or was it just one score that was higher?

On this site, the EQ FICO score version that is used is Beacon 5.0. This is the EQ version that is still the most widely used among mortgage lenders. Most users of this site report that if they pull their EQ score here on the same day as their mortgage lender, the scores are identical. Keep in mind that the FICO score is an instanteous snapshot of your credit profile. Changes can occur even overnight that can result in a score change. If it is a major change - the appearance of a derogatory comment, or the removal of one, for example - the score change can be significant. If your EQ scores really were drastically different, then I'd first look at the credit reports side-by-side to make sure that there were no such changes.

There is a newer version of the EQ FICO score out there, called Beacon 9. It was rolled out last summer. I do not believe that many lenders have moved on to this version, but I imagine that some have done so. If your mortgage lender pulled Beacon 9, then this could explain the difference in score as well.

With regard to TU, a difference in score between myFICO.com and mortgage lenders is almost expected. This is because myFICO.com vends the TU 98 version of FICO, whereas most lenders have moved on to the TU 04 version. Some people have gotten TU scores that are as much as 30 points higher or lower than the TU 98 version.

With regard to the scores pulled by the auto lender, be aware that there are also industry-specific FICO scores out there - in this case, the so-called auto-enhanced FICO score. These scores give added weight to current or prior auto loan history, so the scores can be different as well.

The bottom line is that myFICO.com scores are real. The EQ score from here is the same as that used by the significant majority of mortgage lenders. But in the case of TU, the score that is currently offered unfortunately is different from what most mortgage lenders use. We'd all love to be able to pull TU 04. Why isn't it being offered? It appears to be a business decision by TransUnion. TU isn't even offering TU 04 on the transunioncs.com website - they also sell TU 98.

ETA: Revike is obviously quicker and less verbose. :smileyvery-happy:

Re: FICO Score Variations from MyFICO.com to Broker's Report

Lel — Tue, 25 May 2010 19:56:31 GMT

tstinn wrote:

Did you have any Authorized User tradelines on your credit report? The same thing happened to me and we figured out that MyFICO.com's "consumer credit scoring model" excludes the consideration of AU lines from the score when calculating credit scores, but that all lenders give you a credit score benefit for having them, as long as the history is positive.

It has something to do with the Equal Credit Opportunity Act requiring that all lenders consider AU lines in the score, but MyFICO.com does not have to abide by that because they are not a lender.

The score versions offered here do include authorized user accounts in their score calculations. As mentioned above, the EQ score is no different from that used by the majority of creditors.

Two years ago, there was consideration given to eliminating AU accounts from scoring, in part because of the unethical credit repair practice of piggybacking on a stranger's credit to artificially boost one's credit score. However, because this change would have also eliminated legitimate AU accounts from scoring (e.g. spouses and children), the powers that be have allowed the AU accounts to continue to be included in the FICO score.

Re: FICO Score Variations from MyFICO.com to Broker's Report

RonBurgundy — Tue, 25 May 2010 22:32:03 GMT

The report from the mortgage guy says, "Beacon 5.0 Score" (EQ), "Classic Score" (TU), and "Fair Isaac Score 2" (XPN). I cannot remember which versions the car dealership was using.

I looked for any changes between the reports pulled at MyFICO.com and the reports from the car dealership - while sitting in the finance manager's office, no less - as well as the reports pulled by the mortgage broker. All were exactly identical (except MyFICO.com's report did not have any inquiries, and the car dealership's report had one extra inquiry as a result of the mortgage broker's credit pull earlier that day). There were absolutely no differences, beyond the inquiries, other than the credit scores, which were drastic - 50-70 points on both TU and EQ.

After doing some research , it seems like a lot of people out there are seeing the same pattern occur with regards to the MyFICO.com/Equfax.com scores, as opposed to the scores pulled by lenders. I don't think we are allowed to post links in this forum, otherwise I would reference those testimonials (Google search for "MyFICO.com Equifax.com score different from mortgage broker"). After a search on this web site, I did notice the explanatory statement, "...may not be scores that are used by lenders in making credit decisions," buried in the fine print.

Either way, I think I was able to get the answer to my question. Unless I am completely missing something here, and even though you say there isn't a different version of the scoring model from a broker to MyFICO.com, the only logical explanation is that there is...maybe this was a more recent change...?

Re: FICO Score Variations from MyFICO.com to Broker's Report

llecs — Tue, 25 May 2010 23:18:50 GMT

RonBurgundy wrote:

The report from the mortgage guy says, "Beacon 5.0 Score" (EQ), "Classic Score" (TU), and "Fair Isaac Score 2" (XPN). I cannot remember which versions the car dealership was using.

I looked for any changes between the reports pulled at MyFICO.com and the reports from the car dealership - while sitting in the finance manager's office, no less - as well as the reports pulled by the mortgage broker. All were exactly identical (except MyFICO.com's report did not have any inquiries, and the car dealership's report had one extra inquiry as a result of the mortgage broker's credit pull earlier that day). There were absolutely no differences, beyond the inquiries, other than the credit scores, which were drastic - 50-70 points on both TU and EQ.

After doing some research , it seems like a lot of people out there are seeing the same pattern occur with regards to the MyFICO.com/Equfax.com scores, as opposed to the scores pulled by lenders. I don't think we are allowed to post links in this forum, otherwise I would reference those testimonials (Google search for "MyFICO.com Equifax.com score different from mortgage broker"). After a search on this web site, I did notice the explanatory statement, "...may not be scores that are used by lenders in making credit decisions," buried in the fine print.

Either way, I think I was able to get the answer to my question. Unless I am completely missing something here, and even though you say there isn't a different version of the scoring model from a broker to MyFICO.com, the only logical explanation is that there is...maybe this was a more recent change...?

Out of curiosity, and my answer is hinged on this, what were the positive and negative items listed on your EQ report from myFICO.com?

Re: FICO Score Variations from MyFICO.com to Broker's Report

grandma50 — Wed, 30 Jun 2010 19:01:35 GMT

Can someone explain my situation to me? I pulled all 3 of my credit scores, which were in the 750's. I applied for an auto loan and was told my FICO was 609. I argued with the finance manager and he told me there were 31 score options from Experian alone and it was the smallest of the 3 agencies. Is this true? I am sure he used the worst one. I don't know why I have a low auto score. I have had my car 10 years, it was paid for and due to health reasons, I took a loan using my car title as collateral with American General. My pay date varies and when I asked to change the due date, they wanted me to refinance. This happened twice.

Could this have brought my auto score down? The car dealership told me I was approved thru Toyota Finance and I signed all the papers and drove the car home. Then I get a call 3 days later saying Toyota Finance turned down my credit and I might have to bring the car back. It is the last day of the month today and something has to be decided by close of business today. Right this minute I don't know if I own the car of the Toyota dealership does. Can someone educate me on how many scores really exist? I had no idea there were more than 3!

Re: FICO Score Variations from MyFICO.com to Broker's Report

MarineVietVet — Wed, 30 Jun 2010 19:20:06 GMT

Hello and welcome.

One thing I will ask is where did you get those scores? No one has been able to pull their own Experian FICO score since February of 2009. Creditors can pull Experian and also there is a CU in Pennsylvania that supplies that information to it's members only. You can only buy true FICO scores at a few places. One place is here at myfico. I suggest you do an internet search for "myfico discount codes" to save a little money. You can also purchase your Equifax score at www.equifax.com (If you look hard enough) and your Transunion score at www.transunioncs.com.

There are a myriad of places out there that will sell you a "credit score" but only a few have the scores used by most lenders (FICO scores). If you don't see the word "FICO" from anyone trying to sell a "score" then run away very fast. Those are called FAKO scores around here and cannot in any way be compared or correlated to FICO scores.

So the scores sold at True Credit, the Experian website, freecreditreport.com, freescore.com, freecreditscore.com etc.etc are not the real deal.

From a BK years ago to:
9/09 EX pulled by lender 802
3/10 EQ- 800
6/10 TU -772

You can do the same thing with hard work

Credit Scoring 101
Common Abbreviations
Frequently Requested Threads
Whats In Your FICO Score

Re: FICO Score Variations from MyFICO.com to Broker's Report

grandma50 — Wed, 30 Jun 2010 19:31:20 GMT

Oh my, I've been scammed! I have a subscription I've been paying $15 a month for which gives me one credit report per month with all 3 credit scores and all 3 credit reports. In addition, it is supposed to send me an e-mail update anytime there is a change to any of these. And included is identity theft information. I got it at 3-In-One True Credit. The credit reports had all my information on them and it was up to date. Thank you for any education on this matter than you can provide me. I have cancelled this service. Thank you.

Re: FICO Score Variations from MyFICO.com to Broker's Report

Revike — Wed, 30 Jun 2010 20:23:07 GMT

Many auto lenders use an auto-enhanced version credit score, that can differ significantly from other versions of your credit scores. Also different scoring models use different ranges. The most common Fico scoring models have a 300-850 range, but other scoring models can go lower, or as high as 990, and there can be variances of 100-200 points from one score to another. Also, an auto lender will generally only pull a credit score based on one credit reporting agency, not all three. Often the CRA chosen depends on geographical location or other factors. They don't pull three reports and use the lowest score.

(Edit - Just saw your reply above. True Credit packages the Vantage score with their service. Vantage scores have a range of 501 to 990, so it's very common for a Vantage score to be 140-200 points higher than a corresponding Fico score used by a majority of lenders.)

American General is considered a consumer finance company which can be a negative factor in scoring. In addition, having a title loan on a previous car might be a negative factor when an auto-enhanced score is computed.

Many people aren't aware that sale of an auto is conditional on final credit approval, and it's not unusual for some customers to find out after they have driven off the car lot that credit was denied and they need to obtain alternate financing or return the vehicle. Of course, car salesmen don't spend a lot of time explaining such technicalities.

In the contract, it should have a section that describes the ability and limitations for the dealer to cancel. A 10-day period is fairly common. What can happen, for example, is the financing entity might not be able to confirm income or some other piece of data until several days after the original transaction, especially if the original sale was on a weekend.

If you have a relationship with a credit union, or want to start one, you might see if one can approve auto financing for you. CUs tend to have pretty good auto loan rates, and are much more straightforward with their customers than many auto dealers ...

Re: FICO Score Variations from MyFICO.com to Broker's Report

Lel — Wed, 30 Jun 2010 19:52:52 GMT

To add to what marinevietvet has already mentioned, which is accurate, there are a couple other things worth mentioning.

First, in addition the the "plain vanilla" FICO scores, there are also industry-specific scores. For car buying, lenders will often use the so-called "auto enhanced" credit scores, which give added weight to previous auto loans. When I bought a Toyota last year, the dealer pulled Experian Auto Risk v2 version of FICO. I suppose it is possible that those car title loans are weighing on your auto enhanced FICO score.

Second, while it's true that you didn't realize that the TrueCredit scores aren't the scores used by most lenders, they still give you a general sense of your credit standing. Plus, it offered some other useful services, including regular credit reports (which aren't affected by the credit scoring formula that was used), credit monitoring, and identity theft protection. So, it wasn't all bad, and you're not the first (not certainly won't be the last) to believe that the TC scores were useful for credit application purposes.

Third, the thing that I'm most worried about is the sequence of events with the car dealer. A well-described scam is exactly as you have described: you go to the dealer, apply for credit, are told that you're conditionally approved, and you drive off the lot. You enjoy the car for a couple days (sometimes a couple weeks), get really used to it, and then hear that your credit application was actually denied. You are then given the choice of turning the car back in or agreeing to financing terms that are not favorable to you. By this time, some car buyers are so smitten with their new vehicle that they agree to the lousy terms.

In this day and age, auto financing approvals are pretty instantaneous. There should be no reason why the dealer couldn't have given you firm financing terms at the time of purchase.

Lastly, another dishonest sales tactic is for dealers to lie about the credit scores they pull. That's why it's always good to go armed with a copy of your credit report and score - and with financing from an outside entity like your bank.

Re: FICO Score Variations from MyFICO.com to Broker's Report

MarineVietVet — Wed, 30 Jun 2010 20:58:26 GMT

Lel wrote:
To add to what marinevietvet has already mentioned, which is accurate, there are a couple other things worth mentioning.

First, in addition the the "plain vanilla" FICO scores, there are also industry-specific scores. For car buying, lenders will often use the so-called "auto enhanced" credit scores, which give added weight to previous auto loans. When I bought a Toyota last year, the dealer pulled Experian Auto Risk v2 version of FICO. I suppose it is possible that those car title loans are weighing on your auto enhanced FICO score.

Second, while it's true that you didn't realize that the TrueCredit scores aren't the scores used by most lenders, they still give you a general sense of your credit standing. Plus, it offered some other useful services, including regular credit reports (which aren't affected by the credit scoring formula that was used), credit monitoring, and identity theft protection. So, it wasn't all bad, and you're not the first (not certainly won't be the last) to believe that the TC scores were useful for credit application purposes.

Third, the thing that I'm most worried about is the sequence of events with the car dealer. A well-described scam is exactly as you have described: you go to the dealer, apply for credit, are told that you're conditionally approved, and you drive off the lot. You enjoy the car for a couple days (sometimes a couple weeks), get really used to it, and then hear that your credit application was actually denied. You are then given the choice of turning the car back in or agreeing to financing terms that are not favorable to you. By this time, some car buyers are so smitten with their new vehicle that they agree to the lousy terms.

In this day and age, auto financing approvals are pretty instantaneous. There should be no reason why the dealer couldn't have given you firm financing terms at the time of purchase.

Lastly, another dishonest sales tactic is for dealers to lie about the credit scores they pull. That's why it's always good to go armed with a copy of your credit report and score - and with financing from an outside entity like your bank.

A very good point which I always seem to forget.

Another thing I forgot to add is that although the scores from these places are useless the reports themselves are accurate. Even then you don't have to pay for a report. By law everyone is entitled to one free credit report per year from each of the three CRA's. You probably already know this but many people still don't. You can get those free reports at annualcreditreport.com.

Re: FICO Score Variations from MyFICO.com to Broker's Report

grandma50 — Wed, 30 Jun 2010 22:17:49 GMT

I thought I had covered all my bases. I knew (I thought) what my 3 scores were and told the dealership before I applied. I did not know there were industry specific scores. I have listened to Dave Ramsey and Suze Orman for YEARS and no one has ever mentioned that. My scores were 750 and above on the 3 I got from True Credit. When the dealer told me his showed 609, I questioned it. He then told me Experian alone had 31 to choose from. I suppose each was specific to an industry. I signed all the paperwork on Friday afternoon about 6:00 p.m. The finance manager said it had been approved, I signed all the papers and drove off with my car. Something didn't feel right about it, so I called the salesman and asked if everything was in order. That's when he told me they were having trouble getting the loan thru. "We thought it had been approved but now they are kicking it back." I said "Well, do you still have my car? And can we unwind the whole transaction because if I will want my car back if the new one can't get a loan." I am giving them the benefit of the doubt because they got it to go thru today (the last day of the month) and it was the same interest rate but 5 months shorter on the term. It is a very large, very reputable Toyota dealership that I have used satisfactorily for about 25 years. I hope they didn't gouge me on the interest rate.

I was prepared for the extended warranty speel and I dodged that one. Thanks for all your help. I wish I had known these things before I went car shopping. My older Toyota had rolled over 100,000 miles and could not pass emissions standards. I could not renew the tags. I consulted with a repair shop and was told they would have to tear the car down to find where the problem was and that could be very costly. He said there was no way to know what it would cost until they tore into it. Based on the fact that 3 different places had told me my car was worth about $3,000, it needed new tires and an oil change plus the repairs. I opted to buy a new one rather than risk the cost of repair. Thank you all so much for your information.

Re: FICO Score Variations from MyFICO.com to Broker's Report

MarineVietVet — Wed, 30 Jun 2010 23:00:20 GMT

May I ask what interest rate you ended up with?

For what it's worth I know I get taken every time I buy a car. I just try my best to minimize the damage as much as possible. :smileyhappy:

Re: FICO Score Variations from MyFICO.com to Broker's Report

grandma50 — Thu, 01 Jul 2010 03:19:11 GMT

I didn't have much of a downpayment and they insisted my credit score, the Beacon 5.0 auto industry option, was 609. I ended up signing for 22 percent. I plan to make payments for a few months, save up some money, then finance it with my credit union. Hopefully, my Beacon score will increase or the credit union will use my regular FICO score. If that doesn't work, I am going to make massive principal payments to decrease the outrageous interest. Now I know why Dave Ramsey says credit is bad!

Re: FICO Score Variations from MyFICO.com to Broker's Report

MarineVietVet — Thu, 01 Jul 2010 03:34:33 GMT

grandma50 wrote:
I didn't have much of a downpayment and they insisted my credit score, the Beacon 5.0 auto industry option, was 609. I ended up signing for 22 percent. I plan to make payments for a few months, save up some money, then finance it with my credit union. Hopefully, my Beacon score will increase or the credit union will use my regular FICO score. If that doesn't work, I am going to make massive principal payments to decrease the outrageous interest. Now I know why Dave Ramsey says credit is bad!

Dave Ramsey has some good things to say but I disagree that credit in and of itself is bad. Credit is a tool and a means to an end but like any tool it can do much harm if not understood and used correctly. Knowledge is such an important part of credit use and money management. You can never learn too much about credit and debt. I'm convinced no one can ever know everything out there but we can try. :smileyhappy:

Have you not already learned what not to do next time? You now know about different types of scores that you will carry forward. Knowledge, knowledge, knowledge. If you stick around here you'll be amazed at what you can learn.

I hope you will keep reading and keep posting.

Edited to add: My CU doesn't use the auto enhanced FICO and perhaps you can find one also.

Re: FICO Score Variations from MyFICO.com to Broker's Report

BungalowMo — Thu, 01 Jul 2010 15:12:58 GMT

grandma50 wrote:
I didn't have much of a downpayment and they insisted my credit score, the Beacon 5.0 auto industry option, was 609. I ended up signing for 22 percent. I plan to make payments for a few months, save up some money, then finance it with my credit union. Hopefully, my Beacon score will increase or the credit union will use my regular FICO score. If that doesn't work, I am going to make massive principal payments to decrease the outrageous interest. Now I know why Dave Ramsey says credit is bad!

Can I ask, why didn't you finance through your CU to begin with? They traditionally have better rates than a bank.

I have to address this as well: Dave Ramsey can afford to say credit is bad...he can afford to say "pay cash for everything" & a FICO score is an "I love debt score". He is a millionaire...and 99% of the general population is NOT. That basic mindset is not realistic for the rest of us. We have to educate ourselves, learn what is and is not a sound decision regarding our finances, and ask questions when we are not sure.

To have access to things we want, like a home and a vehicle or two, or emergency $$ on the road, most of us need credit. There is nothing wrong with credit. It all depends on how you utilize it. The very most important lesson I have learned (besides timely payments every month) is that I had to stop looking at my credit as an extension of my salary. I look at it now, more as a "loan, until payday" especially if I have the full, charged amount in my checking acct. As soon as the balance posts, I pay it in full.

At some point in time, I may need a big chunk of one of those cards, should I have a problem with my vehicle while travelling. Having access to that kind of backup is a nice thing. And I won't beat myself up if this is one of those times where it may take several months to pay off. That card gives me 0% interest for a year on auto related charges.