Beacon Score--This is a description of it

[Anonymous]

I found this on www.experian.com/ask_max/max011404b.html

According to Maxine Sweet, Experian's Vice-President of Public Education:

Credit scores for auto lending

Dear Max,
Is there such a thing as an auto inflated Beacon score through Experian? I recently leased a vehicle, but I didn't qualify for their prime leasing program because my score was too low. I just bought a house, and I know two of three of my scores were over 700. They showed me a score in the 640's and said it's different because it's auto inflated.
- JKR

Dear JKR,
You can't get a Beacon score through Experian. A Beacon score is the Fair Isaac Corporation (FICO) score calculated using information from Equifax. The FICO score calculated using Experian information is called the Experian/Fair Isaac score. When the FICO score is calculated using information from Trans Union, it’s called the Emperica score.

It’s the same Fair, Isaac risk score, but the formula has been adapted to work with the different computer systems at each of the national credit reporting agencies. The names are different for marketing reasons.

The FICO score you refer to is a “generic” credit risk score, meaning it is used in many different types of lending decisions.

I'm not sure what the lender meant by “inflated,” but there also are credit risk scores specifically designed for auto lending. It is quite possible that the auto-specific score would be different than a credit score used for general lending purposes, or credit scores designed only for mortgage lending.

Credit scoring systems all look at the same information – the details in your credit report. However, the systems look at the information slightly differently depending on the risk the score is measuring.

Those differences are usually very subtle. The things that indicate lending risk – late payments, charged-off accounts, collection accounts, maxxed-out credit card limits – are the same, no matter what credit scoring system is used. The way those issues are measured by the credit risk scoring system is just different and is based on actual results demonstrated by consumers in those specific lending situations.

For instance, credit risk score developers have told me that people are more likely to skip a car payment when things are tight than they are a house payment. As a result, a recent late payment might make a bigger difference in an auto-specific score than in a mortgage-specific score.

To find out what most impacted the credit scores you received, look at the risk factor statements provided with them. The risk factors describe what elements from your credit history most impacted the scores. Because the elements that indicate risk are the same, the risk factors will likely be very similar, if not identical.

Use those factors to change your credit behavior and the information in your credit history, and all of the credit scores calculated using your credit report will get better.

----Now I understand what my credit union said today about their using the Beacon score.  Funny thing is that when I further questioned, the loan officer had no idea what is a "Beacon" score.  I have learned quite a bit in the last 24 hours on this board.  Thanks everyone!

[Junejer]

---

@Anonymous wrote:

I found this on www.experian.com/ask_max/max011404b.html

According to Maxine Sweet, Experian's Vice-President of Public Education:

Credit scores for auto lending

Dear Max,

----Now I understand what my credit union said today about their using the Beacon score.  Funny thing is that when I further questioned, the loan officer had no idea what is a "Beacon" score.  I have learned quite a bit in the last 24 hours on this board.  Thanks everyone!

---

The problem with the way many bankers are trained these days is that they are trained to be "order takers". I mean no disrespect, because the bank has to do what is most efficient for their bottom line. Unfortunately, the consuming public is who suffers behind it. If your banker is trained to understand how to underwrite, then you will get answers like: well, the underwriter said that... or the one that you posted above.

I know step down from my soapbox.

BTW, I say this as a long-time banker, trained by some of the best bankers in the business.

[haulingthescoreup]

Well, I am grudgingly impressed that an Experian exec explained things accurately and didn't try to pimp their PLUS score or the Vantage score!

ByrdMan, so much of what you describe affects (and afflicts) every profession these days. A bit of surface knowledge and knowing how to run Excel seems to be accepted as sufficient training, but there isn't a good foundation of understanding as to what is going on. So whenever something out of the ordinary comes along, no one seems to know how to analyze it, interpret it, and deal with it properly.

[Junejer]

---

@haulingthescoreup wrote:
Well, I am grudgingly impressed that an Experian exec explained things accurately and didn't try to pimp their PLUS score or the Vantage score!

ByrdMan, so much of what you describe affects (and afflicts) every profession these days. A bit of surface knowledge and knowing how to run Excel seems to be accepted as sufficient training, but there isn't a good foundation of understanding as to what is going on. So whenever something out of the ordinary comes along, no one seems to know how to analyze it, interpret it, and deal with it properly.

---

Tis true and oh so sad. Where has specialized knowledge gone?