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Established Member
eemjlh
Posts: 11
Registered: ‎10-20-2007
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TransUnion - FICO Score (Scoring of credit union cards vs "national" bank cards)

[ Edited ]
Hi, I ordered the FICO Credit Complete and my question is regarding the section under "What's hurting your FICO score". My report shows "There is no recent activity on your credit
card. Your credit report shows no open credit cards or it does not report recent information." I don't understand this since I use my credit card on a montly basis and I pay on it twice a month. The TU report does show my recent CC balance - so why would I receive this message as an item that is hurting my FICO score?




edit: changed title at suggestion of member --this is something many of us are just learning about!

Message Edited by haulingthescoreup on 04-01-2008 06:36 PM
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Barry
Posts: 4,390
Registered: ‎03-01-2007
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Re: TransUnion - FICO Score (Scoring of credit union cards vs "national" bank cards)

[ Edited ]

eemjlh wrote:

Hi, I ordered the FICO Credit Complete and my question is regarding the section under "What's hurting your FICO score". My report shows "There is no recent activity on your creditcard. Your credit report shows no open credit cards or it does not report recent information." I don't understand this since I use my credit card on a montly basis and I pay on it twice a month. The TU report does show my recent CC balance - so why would I receive this message as an item that is hurting my FICO score?
Hi eemjlh....You've pointed out an example of where myFICO needs to do a better job of explaining certain factors affecting the score -- and I'm letting the appropriate people at myFICO know.

What this should have said is something like "There is no recent activity on a national bank credit card."

This is because, while it's good to have any credit card, the scoring formula gives you a few more points for having a card issued by a "national" bank card issuer, i.e. Chase, BofA, Wells Fargo, etc, as opposed to a small/regional bank or credit union.  Is your credit card issued by one of these?

Keep in mind that this factor does not count for a lot of points, i.e. payment history or revolving utilization, but still can keep your score from being higher.

Sorry, this description didn't do a better job of explaining but I do appreciate you bringing to my attention so we can fix it.

Barry

Message Edited by haulingthescoreup on 04-01-2008 06:42 PM
In a past life I served as FICO consumer affairs manager, FICO media spokesman, and myFICO Forums community manager from 2007 to 2012. I'm now freelance writing about credit at CreditCards.com and on my own site, SpeakingOfCredit.com.
Established Member
eemjlh
Posts: 11
Registered: ‎10-20-2007
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Re: TransUnion - FICO Score (Scoring of credit union cards vs "national" bank cards)

[ Edited ]
Thanks, Barry. My CC is issued by a credit union (USAA). I called customer service at both myFICO and TransUnion and the reps I spoke to were unable to answer my question. I appreciate you clarifying the issue. Thanks, again.


Message Edited by haulingthescoreup on 04-01-2008 06:42 PM
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haulingthescoreup
Posts: 28,098
Registered: ‎04-01-2007
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Re: TransUnion - FICO Score (Scoring of credit union cards vs "national" bank cards)

[ Edited ]
Barry, I truly learn something new every day! My USAA cards are not ranked as highly as my pathetic Citi-issued Sears MC? Is this just a TU thing, or is this true of all three CRA's?

Just when I had banned the Sears MC to permanent sock-drawerhood! :smileymad:

Message Edited by haulingthescoreup on 04-01-2008 06:43 PM
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
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imducky
Posts: 3,432
Registered: ‎08-27-2007
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Re: TransUnion - FICO Score (Scoring of credit union cards vs "national" bank cards)

[ Edited ]
alright! i thought issuer didn't matter. ie, visa is visa when it comes to fico scoring. so it can be seen as issuers like first premeire and the rest of the sub primes can be taken into scoring.
the fact that a "prime" cu like usaa's cards aren't scored with the big boy's is yet another "flaw".
also, what/who determines "national" status? you can't find a wachovia, wells fargo, citi, or boa branch in my region, but these would be considered "national" and not usaa?


Message Edited by dnm45227 on 01-26-2008 11:43 AM

Message Edited by haulingthescoreup on 04-01-2008 06:43 PM
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haulingthescoreup
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Re: TransUnion - FICO Score (Scoring of credit union cards vs "national" bank cards)

[ Edited ]
moving thread to Understanding FICO Scoring

Message Edited by haulingthescoreup on 04-01-2008 06:43 PM
* Credit is a wonderful servant, but a terrible master. * Who's the boss --you or your credit?
FICO's: EQ 781 - TU 793 - EX 779 (from PSECU) - Done credit hunting; having fun with credit gardening. - EQ 590 on 5/14/2007
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Boscoe
Posts: 660
Registered: ‎09-11-2007
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Re: TransUnion - FICO Score (Scoring of credit union cards vs "national" bank cards)

[ Edited ]
Agreed, it does not seem fair or correct that FICO's scoring formula would suggest that a borrower is riskier simply because it does not have a big boy card.
While we all agree that finance companies like Household Finance, and subprime cards like First Premiere or Orchard should be dinged a couple of points, the nationals shouldn't automatically give its users scoring benefits. This almost sounds like the big boys and FICO got together and put this in the formula. Who exactly decides "national"???
I have found that lots of credit unions, whether they be Navy FCU, Penfed, Nasa, etc. or a smaller local CU give better interest rates, no annual fees, generous credit limits, even rewards than some of these bigger cards.
So, in effect, FICO is penalizing us for shopping for the best overall cc deal.
Can Barry advise whether this "feature" of the FICO formula will be adjusted at all with FICO 08? This discovery kind of flies in the face of the overall FICO mantra of "the lower the risk of the borrower, the higher the FICO score".


Message Edited by haulingthescoreup on 04-01-2008 06:44 PM
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ByrdMan
Posts: 7,970
Registered: ‎12-19-2007
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Re: TransUnion - FICO Score (Scoring of credit union cards vs "national" bank cards)

[ Edited ]

Boscoe wrote:
Agreed, it does not seem fair or correct that FICO's scoring formula would suggest that a borrower is riskier simply because it does not have a big boy card.

Edit: ByrdMan wrote:

Fair, I'll tell you what's not fair...asthma, okay. I'm a good runner, but I don't have the wind though (I love that US Cellular commercial).

In all seriousness though, there comes a time when our fiscal responsibility meets our FICO responsibility head on and we have to decide what's best. If not apping, probably opt for the better rates and terms.

You are right though. It's not fair.


Message Edited by ByrdMan on 01-28-2008 01:05 PM

Message Edited by haulingthescoreup on 04-01-2008 06:44 PM
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MidnightVoice
Posts: 8,161
Registered: ‎03-25-2007
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Re: TransUnion - FICO Score (Scoring of credit union cards vs "national" bank cards)

[ Edited ]


Boscoe wrote:
So, in effect, FICO is penalizing us for shopping for the best overall cc deal.



I will still keep my CU card for emergencies - it has a low fixed APR :smileyhappy:
And I will assume that my Chase and Amex, and possibly Barclay's, will count as "National".
Next thing, they will be giving extra points for "International" credit cards :smileyvery-happy:


Message Edited by haulingthescoreup on 04-01-2008 06:44 PM
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cheddar
Posts: 6,794
Registered: ‎09-29-2007
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Re: TransUnion - FICO Score (Scoring of credit union cards vs "national" bank cards)

[ Edited ]


Boscoe wrote:
So, in effect, FICO is penalizing us for shopping for the best overall cc deal.

This surprises me as well. Although we shouldn't be surprised that FICO penalizes us for shopping for the best deal.
Maxing out a card because you have a 0% promo rate makes good fiscal sense, but horrible FICO sense, for example. This is really no different. What's good for the wallet is often detrimental to FICO.


Message Edited by haulingthescoreup on 04-01-2008 06:45 PM
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