Why is MyFico score different from what Lender is pulling?

[Anonymous]

Hi all, I'm new here but I signed up for the credit reporting because we're trying to buy our first home. My husband's score is in the high 700's but mine is in the mid 600s thanks to my own credit card debt (stupid me.) We're trying to qualify for an FHA loan but my score that the lender is pulling comes up as 629 (doesn't qualify.) My MyFico score comes up as 649 (does qualify.) Why are these so different?

Right now I'm using every available cent to pay down my credit cards (already paid off nearly $1500 in a week!) But why is the score I'm getting here so different than what the lender is getting, and does anyone know of a way for me to access THAT score to keep an eye on instead of the apparently innaccurate MyFico.com score? I have until closing to pull up my score by 11 points or the loan will end up going entirely in my husband's name (okay with us, but not preferable.)

Thanks in advance for your advice.

[Revelate]

Welcome to the forums!

There's a slew of avaiable FICO versions, and unfortunately the Equifax score that's found here simply isn't commonly used in the mortgage market.

The score you're almost certainly looking for is Equifax Beacon 5.0, which you can purchase from Equifax directly (look for their FICO score, or Scorepower product, seen it listed both ways and they do sell a worthless educational score so just double check it says FICO on it).  Similar yuppie foodstamp for access, but it's the gold standard for mortgage estimation currently unless you happen to be a member of either DCU (Equifax) or PSECU (Experian) with the scores they provide... pay the $20 as you don't want to be opening new accounts / new inquiries anyway in the mortgage process.

If you list out your credit cards, balances, and limits we can suggest what to strategically pay to improve your score the most, in general less credit card debt more better but it's more complicated than that unfortunately.

[Anonymous]

Thanks so much for responding. The product I bought from this site was the

3-Bureau
Credit Monitoring

I thought that would provide the most accurate score but my lender's is so much lower. AND, my score just dropped by 7 points on both Equifax and TU by paying DOWN my debt. ARG!

Here's my debt profile, debt with limits in parenthesis: I'm trying to make sure I pay all my highest balances down first, but that strategy somehow backfired in a score drop. I appreciate your advice.

Kohls: $1,869.99 ($2,000.00)
Target: $0 ($400.00)
Old Navy: $4,726.49 ($5,100.00)
Walmart: $3,077.48 ($3,300.00)
Mastercard: $381.19 ($500.00)
Citibank: $3,347.90 ($5,000.00)
Chase: $337.00 ($600.00)
Chase: $2,055.80 ($5,000.00)
Chase: $447.80 ($500.00)
Toys R Us: $0 ($700.00)
TJ Max: $0 ($500.00)
Capitol One: $266.43 ($300.00)
American Express: $859.00 ($1,000.00)
Sears $222.41 ($2,000.00)
Mastercard $419.54 ($1,000.00)

[Creditwiser]

Many of your balances are dangerously close to your limits. I would attack all that are above 50-60% of limit.  Your profile scares lenders. Kohls, Old Navy, Walmart, Chase, Cap1, Amex are all way too close to the limits.  I suspect if you had the money to pay them down your scores would shoot up nicely provided eveything else was in order.

[-NewGuy-]

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@jettech wrote:

Many of your balances are dangerously close to your limits. I would attack all that are above 50-60% of limit.  Your profile scares lenders. Kohls, Old Navy, Walmart, Chase, Cap1, Amex are all way too close to the limits.  I suspect if you had the money to pay them down your scores would shoot up nicely provided eveything else was in order.

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I would agree with this. If you are looking for score improvements, pay down each that you can so that the percentages across all the high ones go down equally. In other words, pay down balanes so that you have no UTIL that is higher than 80%, then 70%, etc across the board, instead of paying ne or two off completely while leaving the others high.

[Anonymous]

Thank you. That's been my plan of attack. I made a spreadsheet that showed how much of each I'd have to pay to get them under 85% of the limit to start, then 80%, and so on. I'm sending the money there first. But so far it only dropped my score. Oh, and I also had my husband add me as an auth user on his good accounts but that didn't give me a score bump like I'd hoped.

[jeffeverde]

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@Anonymous wrote:
Thank you. That's been my plan of attack. I made a spreadsheet that showed how much of each I'd have to pay to get them under 85% of the limit to start, then 80%, and so on. I'm sending the money there first. But so far it only dropped my score. Oh, and I also had my husband add me as an auth user on his good accounts but that didn't give me a score bump like I'd hoped.

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AU accounts aren't included in the new FICO '08 model (used on myFICO). Supposedly, FICO '08 "selectively excludes AU accounts to prevent abuse of AU's to artifically enhance credit profiles".  I've yet to hear of someone reporting that their FICO'08 is including AU's.  But for mortgage purposes, AU's *DO* count in the older FICO'04 that mortgage lenders use.

Your utilitzation is clobbering your score, on both FICO '08 and '04 scores.  You're at 65% util, overall, and 3 or your largest accounts are at over 90% utilization. Mortgage lenders will want to see your utilization and total debt come WAY down.  Most of the credit score sites include "What if" tools, that will approximate the effect of, for example, paying down your debt.  I suspect you'll see a 50-70pt jump if you get your utilization under 10%.  Is a cash-out refi an option, to consolidate your (expensive) unsecured debt? 

re: paying down a balance causing your score to drop - -something else was going on there.  If there's nothing new on your report, and the rest of your balances remained flat, check the credit limit on the account you paid down - it's possible the creditor reduced your CL as you brought your balance down.

[MarineVietVet]

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@jeffeverde wrote:

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@Anonymous wrote:
Thank you. That's been my plan of attack. I made a spreadsheet that showed how much of each I'd have to pay to get them under 85% of the limit to start, then 80%, and so on. I'm sending the money there first. But so far it only dropped my score. Oh, and I also had my husband add me as an auth user on his good accounts but that didn't give me a score bump like I'd hoped.

---

AU accounts aren't included in the new FICO '08 model (used on myFICO). Supposedly, FICO '08 "selectively excludes AU accounts to prevent abuse of AU's to artifically enhance credit profiles".  I've yet to hear of someone reporting that their FICO'08 is including AU's.  But for mortgage purposes, AU's *DO* count in the older FICO'04 that mortgage lenders use.

Your utilitzation is clobbering your score, on both FICO '08 and '04 scores.  You're at 65% util, overall, and 3 or your largest accounts are at over 90% utilization. Mortgage lenders will want to see your utilization and total debt come WAY down.  Most of the credit score sites include "What if" tools, that will approximate the effect of, for example, paying down your debt.  I suspect you'll see a 50-70pt jump if you get your utilization under 10%.  Is a cash-out refi an option, to consolidate your (expensive) unsecured debt? 

re: paying down a balance causing your score to drop - -something else was going on there.  If there's nothing new on your report, and the rest of your balances remained flat, check the credit limit on the account you paid down - it's possible the creditor reduced your CL as you brought your balance down.

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This is not quite correct. I found this statement from myFICO here: Questions about FICO 08.

Every generation of the FICO Score formula has included authorized user credit card accounts when calculating a person's score. FICO 8 Score continues that policy. This can help people benefit from their shared management of a credit card account. It also helps lenders by providing scores that are based on a full snapshot of the consumer's credit history.

To protect lenders and honest consumers, the FICO 8 formula substantially reduces any benefit of so-called tradeline renting. That's a credit repair practice that entices consumers into being added to a stranger's credit account in order to misrepresent their credit risk to lenders.

[jamie123]

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@-NewGuy- wrote:

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@jettech wrote:

Many of your balances are dangerously close to your limits. I would attack all that are above 50-60% of limit.  Your profile scares lenders. Kohls, Old Navy, Walmart, Chase, Cap1, Amex are all way too close to the limits.  I suspect if you had the money to pay them down your scores would shoot up nicely provided eveything else was in order.

---

I would agree with this. If you are looking for score improvements, pay down each that you can so that the percentages across all the high ones go down equally. In other words, pay down balanes so that you have no UTIL that is higher than 80%, then 70%, etc across the board, instead of paying ne or two off completely while leaving the others high.

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I agree with these guys ^^^^^^^^^^^. Good advice^^^^^^^^^.

I would suggest paying all your balances down so the percentage of credit line used on each card is relatively equal. You will see a boost in points the lower you can get that percentage. The boost could be substantial as another poster said. If you were able to get it below 10% you could easily boost your scores 50 points.

Adding those AU accounts from your husband is probably the reason you lost points. They may be seen as new accounts by FICO. Do not mess with your credit reports right now! The only thing you need to do is get your balances down and your scores will rise.

Some food for thought...

YOU DO NOT KNOW HOW TO USE CREDIT CARDS! The high balances on your credit cards demonstrate that as a fact. You should only carry a credit card balance month to month in an emergency and no, those cute shoes at the mall were not an emergency.

Please, do some research on these forums and learn better credit management skills so you don't get yourself into trouble in the future.

[Creditwiser]

Here's my debt profile, debt with limits in parenthesis: I'm trying to make sure I pay all my highest balances down first, but that strategy somehow backfired in a score drop. I appreciate your advice.

Kohls: $1,869.99 ($2,000.00)
Target: $0 ($400.00)
Old Navy: $4,726.49 ($5,100.00)
Walmart: $3,077.48 ($3,300.00)
Mastercard: $381.19 ($500.00)
Citibank: $3,347.90 ($5,000.00)
Chase: $337.00 ($600.00)
Chase: $2,055.80 ($5,000.00)
Chase: $447.80 ($500.00)
Toys R Us: $0 ($700.00)
TJ Max: $0 ($500.00)
Capitol One: $266.43 ($300.00)
American Express: $859.00 ($1,000.00)
Sears $222.41 ($2,000.00)
Mastercard $419.54 ($1,000.00)

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It really does boil down to the numbers above.  They aint pretty.  The good news is when you pay them down you'll wonder whose Fico scores you're now lookin at