Please read this and pass it along. An excellent article about why FAKE "consumer scores" should not be purchased and why they mean very little, if anything......
Feel free to link to this post, and to include in the "sticky" threads at the top.
Certain Credit Reporting Agencies could be taking advantage of you right now.
They sell you consumer credit scores instead of your FICO credit scores.
As you should know by now, when you apply for any credit-related transaction, the lender or bank will look at your FICO credit scores. They will NOT look at consumer credit scores.
What is a consumer credit score? It's any credit score that doesn't say it's a FICO credit score.
Consumer Credit Scores Are Useless
and Nothing but Complete Rip-Offs!
These companies know that most folks don't understand the difference between a credit score and a real FICO credit score, so they created these fake credit scores and often offer them to you free if you purchase one of their products or services.
If you've ever been on a website and it says something like: “Order today, and get your FREE credit score...”
FAKE!
But it gets worse. Almost evil...
The companies that are selling these fake scores aren't just little, unknown, fly-by-night operations.
In fact, you're going to be very surprised in a second when I tell you who some of these companies are.
Take a deep breath...
These companies include two of the three credit reporting agencies!
TransUnion and Experian sell fake credit scores!
Now can you see why I get so worked up about this stuff?
There's a BIG Difference Between a Consumer Credit Score and a Real FICO Credit Score
Lenders don't use consumer credit scores. Lenders use FICO credit scores.
TransUnion and Experian created their own credit scoring models and sell those “scores” to unknowing consumers who think they're getting the same scores lenders use to evaluate them.
The credit reporting agencies do this, among other reasons, to avoid paying a royalty to Fair Isaac Corporation (creators of the FICO score)—and because they can get away with it.
So, if you go to TransUnion's or Experian's websites (or their multiple other sneaky sites that I'll identify later), and you purchase a credit score, or another product that includes your credit score for free—it's a fake score!
Of course, that doesn't stop Experian from saying that their FAKE credit score is the same “type used by lenders.” That is not an accurate statement.
In all honesty, I think these scores should be illegal to sell.
People are spending their hard-earned money on scores that have no value. Who would think that the credit reporting agencies themselves would sell fake credit scores?!
Look at it this way. Imagine you walked into a Häagen-Dazs® ice cream parlor and you ordered ice cream. You would expect Häagen-Dazs ice cream, wouldn't you?
But imagine that, instead of using Häagen-Dazs ice cream, they were actually using cheap ice cream they bought from the supermarket—some no-name brand.
Well, that's exactly what these consumer credit scores are.
You purchase a credit score expecting it to give you accurate information about your credit rating and to help you determine whether you'll get approved for a loan or not. Instead, what you're getting is a cheap imitation of the real thing.
You bought the cubic zirconia of credit scores...not the real diamond.
If you purchase a consumer credit score, and take it to a lender, you'll become frustrated.
I hear about this from lenders all the time. A person comes into their office with their consumer credit scores. But when they compare their real FICO credit scores with their consumer credit scores they're different. In some cases the scores are very different—to the point they cannot qualify for what they thought they could based on their consumer scores.
And worse, the lender will know they have someone who doesn't really understand credit scoring, and they may try to take advantage of you.
How Can You Tell When a TransUnion or Experian Representative Is Lying About Credit Scores?
Simple, His Lips Are Moving!
If you ever want to hear someone from TransUnion or Experian lie like a rug—just ask him this simple question...
“Why did you choose to have your credit score range go from roughly 300 to 850?” (This is the same range of the legitimate FICO credit score.)
I've been around enough model developers to know that they can create their models to have any score range they want. The range can be from 1 to 100, A to Z, 0 to 10, or any other values they choose.
The true answer to the above question is, “We chose to have our credit score range from 300 to 850 because we wanted to fool you into thinking you were buying a FICO credit score.”
But, you won't get that answer from a credit reporting agency representative.
You'll get this answer, which I received when researching this topic:
“I'm sorry, but I'm unable to answer your question.”
So TransUnion and Experian work hard to spread the use of their consumer scores. Not by getting lenders to use them. Nope. They work at selling them to unknowing consumers. And if that's not enough, they continue to sell them to vendors who include them in products and services so you think you can monitor your real credit scores. If you take nothing else away from this newsletter, at least remember this—consumer credit scores are... Worthless...Crap...Crud...Bunk...A complete rip-off!
How to Tell a Legitimate FICO Score From a Fake Credit Score
Here's how to tell the difference between a fake consumer credit score and a FICO credit score...
...if it doesn't explicitly say it's a FICO score...it's fake.
FICO is Fair Isaac Corporation's registered brand name and they are very proud of it. If it's a real FICO score, trust me, it's going to say “FICO” all over the place.
I counted 24 references using the term “FICO” on their web page, and I stopped before I got to the end.
The next thing you know, TransUnion and Experian will hire hustlers to sell fake credit scores on the streets of Manhattan...moving from place to place while dodging the police. I wouldn't put it past them.
