Education on FICO vs FAKO needed?

[Anonymous]

Hello. I am very new to this site and the terminology of the credit world. Someone please educate me on what the difference between a FICO and FAKO are?? I see both terms used quite frequently. Also, is it true that I can check my credit score as often as I like with out risking a lower credit score? I am considering purchasing the SW, however, not quite convinced that I necessary need it. I believe my current score is in the 500 range but I'm afraid to check it due to the fact that it may lower my FICO.

[MarineVietVet]

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@Anonymous wrote:

Hello. I am very new to this site and the terminology of the credit world. Someone please educate me on what the difference between a FICO and FAKO are?? I see both terms used quite frequently. Also, is it true that I can check my credit score as often as I like with out risking a lower credit score? I am considering purchasing the SW, however, not quite convinced that I necessary need it. I believe my current score is in the 500 range but I'm afraid to check it due to the fact that it may lower my FICO.

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Welcome to the forums.

First of all you can pull your own score as often as you like and it will never hurt you. And as far as the differences between FAKO and FICO I give you the following excellent explanation by long time member llecs:

"Virtually everyone sells scores, but they are not all FICO scores. If you got scores from the big 3, then very likely 2 or all 3 of them are not FICO scores. Experian and TransUnion do not sell FICO scores on their website. We call these non-FICO scores, FAKOs, and can easily be as much as a few points to 100+ points off your real FICO when pulled the same day. If it didn't say "FICO" next to the score, then it isn't.

Other companies (e.g. freecreditreport.com, freescore.com, truecredit, creditkarma, Equifax Credit Complete, Quizzle, and dozens of others out there) sell scores, but they are nothing more than gimmicks and lenders don't use them. They do this because they want to avoid paying any fees to FICO and when they say "credit score" people buy it anyway on the assumption that it is a FICO. The scores are off because the formula is different, factors in different things as compared to FICO, and score ranges are different than FICO's (e.g. FICO is 300-850, Vantage is 501-990, PLUS is 330-830, TransRisk is 350-850, and so on)."

Edited to correct a typo.

From a BK years ago to:
EX - 3/11 pulled by lender- 835, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

[Anonymous]

wow! thank you so much for this info marine.

[RobertEG]

+1

However, I would not go so far as to call other scoring systems "gimmicks" or portray them as attempts to mislead the public.  The moniker "FAKO" is, in my opinion, a bit unfair.

FICO has had the industry lead in development of credit scoring, and for that and other reasons, is the chosen scoring system used by most lendors.

Being the capitalists that we are, competition is considered useful.  Others are looking for a piece of the pie, and have developed alternative competing products.

They may be just a good, or even better, predictors of risk than the FICO system, so I would not typify them as "gimmicks."  The main problem I have with such products is the manner they are misleadingly marketed.  So, yeah, mabe the term "FAKO" does have merit, but not, in my opinion, based on the products themselves.

It is just a fact of the marketplace that, notwithstanding the competition, most lendors have chosen to stick with FICO scoring.