cancel
Showing results for 
Search instead for 
Did you mean: 

Income doesn't matter to FICO!

tag
Anonymous
Not applicable

Income doesn't matter to FICO!

Can anyone explain why one's income has no bearing on a FICO score?  Seems to me that this plays a big part in creditworthiness, yet FICO doesn't use income (or net worth) as part of their formula in creating a FICO score.
Message 1 of 70
1 ACCEPTED SOLUTION

Accepted Solutions
Anonymous
Not applicable

Re: Income doesn't matter to FICO!

Suze Orman just called me...Wants me on her program on Saturday.  Can't get enough of my big mouth on just the FICO forums pages. 
 
Now if I can just figure out how to speak in large, bright red letters I'll do fine on the show.


Message Edited by bobkelly on 10-14-2007 11:13 AM
Message 63 of 70
69 REPLIES 69
andyaycw
Frequent Contributor

Re: Income doesn't matter to FICO!

FICO doesn't care whether you're a multi-millionaire or someone who makes a dime a year.

FICO is an indicator of how capable, how likely you are of paying back money you borrow.

*A multi-millionaire asks me for $100 and I give it to him, but he doesn't pay me back.
*A hobo on the street asks me for $100 and I give it to him, but he pays me back.

I would rather lend the hobo money in future, rather than the multi-millionaire.

Starting Score: EQ 773, TU 766
Current Score (2/25/2017): EX 813, EQ 823, TU 818
Goal Score: 800


Take the FICO Fitness Challenge
Message 2 of 70
andyaycw
Frequent Contributor

Re: Income doesn't matter to FICO!

On another note, sure it's more likely that the multi-millionaire is more capable of repaying the money, but the bottom line is that income does not have a correlation to whether the person will pay on time.

All people care about is whether or not they're gonna get paid back if they loan you money.

Starting Score: EQ 773, TU 766
Current Score (2/25/2017): EX 813, EQ 823, TU 818
Goal Score: 800


Take the FICO Fitness Challenge
Message 3 of 70
Anonymous
Not applicable

Re: Income doesn't matter to FICO!

Because anyone can spend beyond their limits. Higher income just means they can spend more. It's all about learning control and responsibility.
Message 4 of 70
Anonymous
Not applicable

Re: Income doesn't matter to FICO!



@Anonymous wrote:
Can anyone explain why one's income has no bearing on a FICO score? Seems to me that this plays a big part in creditworthiness, yet FICO doesn't use income (or net worth) as part of their formula in creating a FICO score.





Does having a Ferrari make one a better driver than owning a Hyundai?

More income doesn't necessarily make you a better money manager. Ask Michael Jackson.
Message 5 of 70
Anonymous
Not applicable

Re: Income doesn't matter to FICO!


Does having a Ferrari make one a better driver than owning a Hyundai?

More income doesn't necessarily make you a better money manager. Ask Michael Jackson.


Or ask any rapper Smiley Happy
Message 6 of 70
Anonymous
Not applicable

Re: Income doesn't matter to FICO!



@Anonymous wrote:


@Anonymous wrote:
Can anyone explain why one's income has no bearing on a FICO score? Seems to me that this plays a big part in creditworthiness, yet FICO doesn't use income (or net worth) as part of their formula in creating a FICO score.





Does having a Ferrari make one a better driver than owning a Hyundai?

More income doesn't necessarily make you a better money manager. Ask Michael Jackson.


I would think yes. Have you ever tried to dodge a raccoon at 110 on a Hyundai. Much easier in a Ferrari. Smiley Happy Sorry a little humor.
Message 7 of 70
Anonymous
Not applicable

Re: Income doesn't matter to FICO!

ask any rapper?
Message 8 of 70
Anonymous
Not applicable

Re: Income doesn't matter to FICO!



@Anonymous wrote:
ask any rapper?



Professionals in the rap music industry. Millions in income, terrible credit, bankruptcies, but lots and lots of income. lol.
Message 9 of 70
RobertEG
Legendary Contributor

Re: Income doesn't matter to FICO!

I think it is being a bit naive to state that income has no relationshop to ability tp pay debt... it certanly does.  Paying requires both abiliity and willingness. I think a primary reason why income is not included in FICO scores is due more to the fact that income data is something that they simply do not have the ability to collect and update regularly.  Just try to secure a home loan without disclosure of income, and you will realize that it does count.  FICO is thus not an overall measure of try credit worthiness, but more simply a historical snapshot of how you have paid debt in the fairly recent past.
Message 10 of 70
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.