topic Re: Why such a big difference? in Understanding FICO® Scoring

Why such a big difference?

Anonymous — Wed, 02 Jan 2019 01:43:45 GMT

I just received my Fico quarterly 3B update and my TU was 679, EXP 650 and EQ 651. I understand a small difference but almost 30 points. I looked over all three reports and they are all showing 1 collection and 1 student loan 30+ day late payment. There isn't any difference in the reports. I'm sorry if this topic has been addressed before. But does anyone have any insight as to why there is such a difference?

Re: Why such a big difference?

Revelate — Wed, 02 Jan 2019 01:53:14 GMT

The typical design goal for the algorithms was +/- 30 points for the same file: the individual bureaus tweak the FICO algorithms for their individual data sets. Also I would note that there are some minor details like how tradelines report which may be different between the bureaus and cause them to be factored differently.

Isn't much rhyme or reason, we've never had enough data to analyze it well... and not worth worrying over honestly. You aren't the only one who is concerned though, lenders hate it: it was a non-trivial marketing push with Vantage score to claim they were more consistent across the three... as I understand it one of FICO 9's design goals to try to bring the scores back into closer alignment for identical information.

Re: Why such a big difference?

Anonymous — Wed, 02 Jan 2019 01:56:01 GMT

Thanks for the reply. I've just been working really hard on my credit and it was nice to see I was in the 670's registering good finally but the other two sores are somewhat discouraging.

Re: Why such a big difference?

Anonymous — Wed, 02 Jan 2019 02:38:11 GMT

It's also quite possible that your three reports don't in fact contain identical data. For example, suppose Bob has the exact same five credit cards on all three reports. It's common for the balances on the five accounts to NOT be the same, on any particular day of the month. Bob's Chase Freedom might typically report on the 12th of every month. On the 14th, the new balance has appeared on EX and EQ (say) but hasn't yet materialized on TU. His TU score could easily be 50 points different from EX/EQ, depending on what that balance is.

Re: Why such a big difference?

Anonymous — Wed, 02 Jan 2019 02:42:24 GMT

Another thing to consider would be inquiries, which are only specific to one bureau. Outside of someone with zero inquiries across the board, it's pretty rare that someone has the same exact amount of [scoreable] inquiries on each bureau, thus making "identical" CR data much less likely when comparing reports across the CRAs.

Re: Why such a big difference?

SouthJamaica — Wed, 02 Jan 2019 03:49:26 GMT

@Anonymous wrote:
I just received my Fico quarterly 3B update and my TU was 679, EXP 650 and EQ 651. I understand a small difference but almost 30 points. I looked over all three reports and they are all showing 1 collection and 1 student loan 30+ day late payment. There isn't any difference in the reports. I'm sorry if this topic has been addressed before. But does anyone have any insight as to why there is such a difference?

My TU FICO 8 is regularly about 30 points higher than the EX and EQ versions.

Re: Why such a big difference?

Anonymous — Wed, 02 Jan 2019 13:43:26 GMT

SJ, is that with identical bureau data across all 3B? If not, what are the differences?

Re: Why such a big difference?

Thomas_Thumb — Thu, 03 Jan 2019 00:59:40 GMT

@Anonymous wrote:
I just received my Fico quarterly 3B update and my TU was 679, EXP 650 and EQ 651. I understand a small difference but almost 30 points. I looked over all three reports and they are all showing 1 collection and 1 student loan 30+ day late payment. There isn't any difference in the reports. I'm sorry if this topic has been addressed before. But does anyone have any insight as to why there is such a difference?

As others have mentioned, the CRAs were given "wide" latitude to tweak Fico scoring models to suit their desires. Tweaking was restricted with the rollout of Fico 9. Curious, did you get 3B Fico 9 scores as well and if so what were they?

If your CRA reports are truely identical (including # of inquiries), the spread in Fico 9 scores should be less - could be less than half the spread of Fico 8 based on my experience.

My files were identical with # INQ at 0 on all 3 CRAs except 4/2018 (1 INQ on EQ & TU, 0 on EX). Below is what I saw on some 3B reports.

Fico Model Name	Feb-16	Mar-16	Jul-16	Aug-16	Oct-16	Mar-17	Apr-18
EQ Bankcard Fico 9	867	877	873	873	858	876	868
TU Bankcard Fico 9	869	879	874	874	863	879	873
EX Bankcard Fico 9	873	878	879	879	862	879	878
Range BCE Fico 9	6	2	6	6	5	3	10

Fico Model Name	Feb-16	Mar-16	Jul-16	Aug-16	Oct-16	Mar-17	Apr-18
EQ Bankcard Fico 8	874	882	881	876	881	887	881
TU Bankcard Fico 8	880	899	881	886	873	899	891
EX Bankcard Fico 8	895	898	900	892	897	900	900
Range BCE Fico 8	21	17	19	16	24	13	19

Re: Why such a big difference?

SouthJamaica — Thu, 03 Jan 2019 01:52:11 GMT

@Anonymous wrote:
SJ, is that with identical bureau data across all 3B? If not, what are the differences?

It's with the same data except for the following:

-5 closed accounts which no longer appear in EQ but do appear in TU and EX, giving EQ a lower average age of accounts than EX and TU. Theoretically this could account for TU being higher than EQ but wouldn't account for TU being higher than EX.

-1 zero balance account which appears as open in EX, but was closed when transferred to another issuer and appears as closed in EQ and TU.

There is of course a difference in inquiries. More than 50% of my hard pulls are with EX, the others are split between TU and EQ. So yes TU has less inquiries than EX, but it has roughly the same number of inquiries as EQ. So while theoretically inquiries could account for a slightly higher TU than EX, it wouldn't account for TU being higher than EQ.

Re: Why such a big difference?

Thomas_Thumb — Thu, 03 Jan 2019 02:51:06 GMT

SJ,

As you say, the increased INQs on EX could be depressing that score relative to TU.

What could account for TU being higher than EQ is CRA tweaking. EQ penalizes more than TU or EX for # accounts with balances. Also, EQ having a lower AAoA than TU may adversely influence EQ relative to TU. What is your AAoA difference?

P.S. How do your Fico 9 scores stack up?

Re: Why such a big difference?

Anonymous — Thu, 03 Jan 2019 02:25:26 GMT

Thanks everyone for all the reponses. I looked at my 3B report more carefully and the FICO 9 scores were a lot closer in range to each other and my TU score dropped by about 10 points. I also noticed that after Capital One gave me a cli that my TU score got the biggest bump from that increase (+17) than the other bureaus(+7). I think I understand things a little better now.

Re: Why such a big difference?

SouthJamaica — Thu, 03 Jan 2019 02:37:53 GMT

@Thomas_Thumb wrote:
SJ,

As you say, the increased INQs on EX could be depressing that score relative to TU.
What could account for TU being higher than EQ is CRA tweaking. EQ penalizes more than TU or EX for # accounts with balances. Also, EQ having a lower AAoA than TU may adversely influence EQ relative to TU. What is your the AAoA difference?

P.S. How do your Fico 9 scores stack up?

Good questions.

1. As to EQ penalizing for # accounts with balances, I doubt that's a factor here because the 30 point spread persists at all levels of the utilization spectrum, even where there was only 1 account with a balance.

2. I'm sure the AAoA error in EQ does count, because one of the missing cards is an old card going back 30 years, my 2nd oldest card. Its absence accounts for a 6-month difference in AAoA. (Lest you think I was dumb to close it, I never did close it; it was a co-branded card switched to another lender.)

3. Consistent with your advice that FICO 9 doesn't give bureaus the same latitude for tweaking that FICO 8 offers, the 30-point TU bonus doesn't exist in my FICO 9 scores; they are usually on an even keel.

Re: Why such a big difference?

Anonymous — Thu, 03 Jan 2019 02:44:13 GMT

In my FICO scorecard / bucket - AoOA 1 year, no derogatories, no public records, 1 installment loan at 8.47% util, no revolving accounts - I observed the following just recently (December 31, 2018 myFICO Ultimate 3B+ monthly):

20 point drop on Equifax from 750 to 730 due to 1 new inquiry, where there were no prior inquiries
19 point drop on Experian from 748 to 729 due to 1 new inquiry, where there were no prior inquiries
Transunion at 728 with 2 inquiries - both of these inquiries do not show on EQ/EX, and the EQ/EX inquiry does not show here on TU, so there was no change

FICO 8 Scores: EQ 730, EX 729, TU 728

FICO 9 Scores: EQ 698, EX 697, TU 709

Re: Why such a big difference?

Anonymous — Thu, 03 Jan 2019 03:16:43 GMT

19-20 point drops for a single inquiry have got to be some of the biggest drops I've heard of.

Re: Why such a big difference?

Anonymous — Thu, 03 Jan 2019 03:45:45 GMT

@Anonymous wrote:
19-20 point drops for a single inquiry have got to be some of the biggest drops I've heard of.

I don't see a lot of posts from people with no revolving accounts on their report, so that seems a likely reason. I've already used one of my newly approved credit cards. The other one hasn't shown up in the mail yet.

The next drop in score will be when that installment loan shows up as closed any day now. I'll have nothing but a few HP's on my report. Want to guess the hit I will take there? I'm guessing I won't even be able to get a library card with that new score.