The purpose of pools (aka scorecards, buckets, ect.) works out more to the benefit of those with derogs or very little to no history than it does them harm.
If there was only one simple bell curve including all credit files then those fortunate, extremely long established folks would have the whole top half of the score numbers scale absolutely locked up tight.
So where would that leave the person who is only beginning to build a credit history at all? Or who has had some derogs in the past but now is trying to work toward a better CR and score? They would be locked down into the basement of the score range for probably ten, twenty years or more. There's no WAY that that new user or rebuilder individual has as much good history yet as that long established individual does.
So what the pools are attempting to do is to help potential lenders figure out which of the new-credit individuals are showing characteristics which usually go on to blossom into a long clean history, and which other ones don't. The same for rebuilding individuals. By assigning relatively better scores to top of each scorecard and lower scores to the least improved, the individuals who are making progress float to the top. They actually are scoring a bit better than they would if being compared head to head with Mr. Jones who has no derogs whatsoever and has 30+ years of history already.
By trying to compare apples to apples and oranges to oranges, that means that amongst the pool of individuals who share certain key history elements, Customer A looks most like someone who will continue to do better and better and is not as likely to default whereas Customer B from the same group is not showing those indicators of steady improvement.
If it weren't for scorecards, IMO, it would be very difficult to get decent mortgages and accounts and loans without thirty years of history already established. That would mean that it would be like climbing an ice mountain barefoot to buy a house or a car or open a credit card before the age of at least forty or fifty.
The pools tend to be split out according to:
-Age of file (length of credit history)
-Thickness of file (number of trade lines)
-Presence of a new account (opened within past X months)
-Presence of seriously negative payment history (90+ days late, charge off, etc.)
