topic Re: Credit Scores vs. FICO Score in Understanding FICO® Scoring

Credit Scores vs. FICO Score

Anonymous — Wed, 23 May 2012 19:47:26 GMT

All three credit companies score me over 800 (806, 819, 817), but my FICO score from the three companies are 694, 7808, 712. What is the difference? I'm been operating under the assumption that I have excellent credit according to the credit companies, but I just applied for a mortgage and my lender says my FICO scores are good, but not great. I'm baffled. What is FICO looking at that makes them adjust the scoring?

Re: Credit Scores vs. FICO Score

crunching_numbers — Wed, 23 May 2012 20:17:30 GMT

Welcome to the forums!

The scores from the credit bureaus are not FICO scores, and use completely different criteria to calculate their numbers. We refer to them as FAKO's. The only number that mortgage companies are concerned with are the FICO numbers. There is a whole bunch of information available here about what FICO looks at. Poke around the threads. The mortgage section will be helpful for mortgage issues, and there is a thread for FICO scoring 101 that is locked on the top that you should start with (the link is below).

http://ficoforums.myfico.com/fico/board/message?board.id=ficoscoring&thread.id=29793

Re: Credit Scores vs. FICO Score

Anonymous — Sat, 26 May 2012 00:11:02 GMT

I need help understanding the differences as well.

So you are saying that usually only Mortgage companies pull an actual FICO score?

What about when applying for credit cards, car loans, etc ...are these creditors also pulling an actual FICO score, or are they usually pulling whatever score each respective Credit Bureas uses.

And do any of the credit bureaus actually use a real FICO score or formula or one that was created by the Fair Issac Company for the Credit Bureau to use, or do all 3 have their own separate, proprietary formula/score that they use?

In other words, when I apply for a credit card or car loan, what score are they seeing?

I've been told to not look at these FAKO scores, that if I want to see what these creditors are pulling I need to pull an actual FICO score. But this confuses me because it seems that each CRA uses their own score and that this is what these creditors are pulling.

I understand the importance of checking my FICO, but is it also worthwhile to track these FAKO scores?

I was about to sign up for the FreeScore.com service, but read many blogs/posts that it was a waste of time because they don't pull real scores but actually the proprietary scores of the credit bureau.

I need to know what scores creditors are seeing (other than a mortgage company), I need to start shopping for a new car and need to know what score will they be pulling, a true FICO or the credit bureau's scores.

Thank you very much!

Re: Credit Scores vs. FICO Score

llecs — Sat, 26 May 2012 00:53:39 GMT

@Anonymous wrote:
I need help understanding the differences as well.

So you are saying that usually only Mortgage companies pull an actual FICO score?

What about when applying for credit cards, car loans, etc ...are these creditors also pulling an actual FICO score, or are they usually pulling whatever score each respective Credit Bureas uses.

And do any of the credit bureaus actually use a real FICO score or formula or one that was created by the Fair Issac Company for the Credit Bureau to use, or do all 3 have their own separate, proprietary formula/score that they use?

In other words, when I apply for a credit card or car loan, what score are they seeing?

I've been told to not look at these FAKO scores, that if I want to see what these creditors are pulling I need to pull an actual FICO score. But this confuses me because it seems that each CRA uses their own score and that this is what these creditors are pulling.

I understand the importance of checking my FICO, but is it also worthwhile to track these FAKO scores?

I was about to sign up for the FreeScore.com service, but read many blogs/posts that it was a waste of time because they don't pull real scores but actually the proprietary scores of the credit bureau.

I need to know what scores creditors are seeing (other than a mortgage company), I need to start shopping for a new car and need to know what score will they be pulling, a true FICO or the credit bureau's scores.

Thank you very much!

Welcome!

All varieties of lenders, mortgage, CC, car folks, etc., pull a FICO score in 99%+ of the time.

FICO worked with lenders to develop the FICO score. The ones available on here and used by almost all mortgage lenders, and a few CC-issuers, car lenders, etc., are called Classic FICO scores. And each CRA version (e.g. your TU FICO, your EQ FICO, your EX FICO) all differ ever so slightly and each CRA weighs your FICO score a little bit differently for each report.

To make things a tad more complex, like with model-year cars, there are also model year scores. Thankfully FICO doesn't do this every year but every few years or so they'll develop a new line of scores factoring in stuff the previous versions did not, usually to our benefit as consumers. Some lenders prefer to use older versions and a rare few have adopted the newer ones.

Mixing it up even more, FICO also developed industry-enhanced FICO scores. The most common ones are CC-enhanced FICO scores and auto-enhanced FICO scores. These weigh your past CC experience and past auto loan history a bit more than Classic scores. For example, if you walked into an auto dealership to buy a car, more than likely they'd pull an auto-enhanced FICO. In contrast, if you walk into a bank to apply for a car loan, more than likely they'd pull a Classic FICO (or at least from what I read of others' posts). If you app for a CC, usually you'll find the lender pulling a CC-enhnanced FICO. There are also mortgage-enhanced FICOs starting with the newest FICO versions (FICO08), but virtually no lenders are using these scores. In fact, they are using older versions of a Classic score.

What does this all mean? MyFICO.com and all of the places out there (a very short list) that offer FICO scores, sell or offer a Classic version of FICO. MyFICO offers a Classic EQ FICO called Beacon 5.0. Virtually all mortgage lenders also use this score. Quite a few lenders out there for car, CC, and installment loans also use this version if they pull EQ for your inquiry. My bank, M&T Bank, uses Beacon 5.0 for every type of credit pull.

MyFICO also sells a TU FICO we call TU98. This version is much older. While quite a few lenders do still use TU98 (Lending Club for sure, and Navy Federal still?) most all of them use a newer version developed 6 years later we call TU04. Unfortunately, you cannot buy this from anywhere but from your lender. The newest, we call TU08, is available from Wal-Mart if you have a CC from them, but despite being the newest, vitually nobody is using them.

For your Experian (EX) FICO, you cannot buy it from anywhere. Experian blocked consumer access ot your own EX FICO score, though you still can get a lender to pull it for you come app time.

There are other places you can get your FICO scores. Many banks and credit unions will provide it for you as part of a benefit or service. For example, you can get your EX FICO from PSECU. You can get you EQ FICO from Unitus CCU and Digital Credit Union. And as mentioned, you can get your TU FICO (TU08) from Wal-Mart. Unfortunately, you cannot get any of the industry-specific scores from anywhere (e.g. auto-enhanced) without the help of a lender.

The above described FICO scores. However, many companies, like freescore.com, TransUnion.com, Experian.com, and hundreds of others sell scores, but they are not FICO scores. They are knock-offs we call FAKOs. Lender do not use these scores. In fact, many of these FAKOs like PLUS scores nad TransRisk scores even come out and say that lender's don't use these scores and are for "educational-purposes only". There is one FAKO you can get from EX and TU and a couple of other sites called a VantageScore, but it is very rare to find a lender that uses a VantageScore. From my observation, it's a dying score.

FAKOs cannot be correlated to FICO. One score can increase and the other decrease for the exact same event/reason. FAKOs factor in stuff that FICO does not and vice-versa. Also, FAKOs' score ranges differ from FICO. For example, Vantage is 501-990 vs. FICO's 300-850. It's easy to see large differences in score.

Re: Credit Scores vs. FICO Score

Anonymous — Sat, 26 May 2012 01:15:18 GMT

Ok,

Thanks for the very informative response.

So auto lenders and CC companies also pull a FICO, sometimes from FICO itself, or a version of FICO that the CRA uses, and you are saying they are close enough to true FICO that if I buy my score directly from TU or EQ then it's what the lender sees and is close enough to true FICO tgat if the lender is pulling true FICO instead, I'll still have a good idea.

If I buy myFico score then I should in the same manner whay what score a lender will see when pulling a score from a CRA.

I also take away from this that I can't buy an EX fico, but if I buy from myFico then I'll have a good idea what score EX is reporting.

I hope I'm understanding tbis correctly. It actually should be simple then, just buy a true FICO from myFico and whatever fico-like score a lender pulls from a CRA should be very similar?

As long as I track myFico then I shouldn't have any surprises from what a CRA will report?

Thanks again for your help and the education!

Re: Credit Scores vs. FICO Score

llecs — Sat, 26 May 2012 01:30:21 GMT

I don't know the technicalities, but because the CRAs hold the data by which a FICO score can be generated, and FICO is reliant on that data, the FICO is licensed out to the CRAs. So, when you pull a FICO via a lender, lender pays a fee to the CRAs for access to that data and score. When you pull from myFICO, myFICO has to forward a chunk of that money to the CRAs.

IMO, never compare a FICO with a FAKO. There are times I have pulled directly from the CRA and compared it to FICO and it would be 5-10-20 points off. There are other days it has been 100 points or more off when still comparing the two same scores. Not very reliable. I have one FAKO now that was 225 points off from my FICO when compared the same day. Now it's closer to 150 off. Still not very reliable. Now that's an extreme example, but I've seen some posters on here put of a new mortgage for months because they relied on a FAKO to guage their FICOs, when in fact they could have qualified all along because their FICOs were high enough. Converely, I've seen some posters claim scores into the high-600s and when they app'd for a mortgage, their FICOs were much, much lower. Enough so that they weren't approved.

You cannot buy an EX FICO from anywhere, not even from myFICO. At one point myFICO did sell an EX FICO but Experian blocked access to that. Again, there are some CUs that offer that score if a member. Lenders can still get it for you too.

It boils down to getting a sense of who pulls what. Just know that the EQ FICO on here, Beacon 5.0, is used by virtually all mortgage lenders, some car and installment lenders, and a small few CC-issuers. YMMV of course. The TU FICO on here is used by a very small number of mortgage lenders, and even fewer car and installment lenders, and not many CC-issuers. Many of us have asked myFICO to upgrade the score to a TU04, but so far no takers on the FICO side. I think it boils down to agreements between TU and FICO on this.

Re: Credit Scores vs. FICO Score

Anonymous — Sat, 26 May 2012 01:49:02 GMT

Thanks again!

So to boil it all down, if I buy my scores from myFICO.com then this should be a very good indicator of what a Lender will see (certainly if it's a mortgage company of the auto/CC lender is pulling straight from FICO), but also if they are not as the score that the CRA's send back to a lender are the FICO versions created for each CRA.

I'll avoid buying directly from a CRA, and and just get the service from myFico that gives the EQ and TU scores, and just let the EX score be what it is, if I ever apply for credit and they pull EX I'll just ask for it or to purchase it.

Going now to go browse over the various products that myFico has and decide which I'd like to get.

Thanks!

Re: Credit Scores vs. FICO Score

Anonymous — Sat, 26 May 2012 02:18:27 GMT

An easy way to remember it is if a website is giving you a real FICO score, they'll be pretty loud about it (see the site here, for example). Lenders ~95%(?) of the time only look at FICO scores, but the formulas might be adjusted to the product (Auto).

All other scores are "for educational purposes," and are really meaningless. Anyone can sell a "credit score." Heck, I can give you one... it's... 785!

Re: Credit Scores vs. FICO Score

llecs — Sat, 26 May 2012 02:36:50 GMT

I'll give a 1052 if anyone wants it. I'll waive my $14.95 cost.

Re: Credit Scores vs. FICO Score

Anonymous — Sat, 26 May 2012 04:44:40 GMT

@llecs wrote:
I'll give a 1052 if anyone wants it. I'll waive my $14.95 cost.

Sweeeeeeet! I'm thinking that will get me a negative 3.5% APR on my mortgage! I'm sure the LO will take my word for it!

...Which again goes to illustrate our point about "FAKO" scores. They can be kind of fun to track, but they generally mean nothing, and worse is some sites give advice that will hurt your actual FICO score (but help the local FAKO of course). Not defending FICO, just answering the OP.

Re: Credit Scores vs. FICO Score

Anonymous — Sat, 26 May 2012 06:35:03 GMT

I will give you a real life auto example. Last year I went into the dealership maybe planning on buying a new truck. The dealership applied to 4 creditors, Ford Financing and three banks. I went home and applied to Cap1. Cap1 approved me for something like 30k (interest rate to be determined by the year of the vehicle I bought). Ford approved me for the truck I wanted 36k financed at 1.9%. All three banks rejected me. Why so much love from Ford? In 2001 I bought a new truck they financed and I never missed a payment. I really am not loyal to Ford, but Ford is loyal to me... /shrug

Re: Credit Scores vs. FICO Score

Anonymous — Wed, 14 Jan 2015 19:01:00 GMT

Let's not get too out of hand with this notion. Where did the figure of 95% of lenders using FICO come from? I'm pretty sure, no wait, I'd bet my last buck it's nowhere near that number. In fact other than the mortgage world, which way other lenders choose as their source is driven by so many different factors, Location being one of them. The lenders' current qualification levels, despite all the other lip dancing, comes down to supply and demand, That's the bottom line. They really don't care if a borrower defaults on a loan. What they really care about is whether or not one of the GSE's is in place to ensure their success, and compensate for any losses.

As for the guy with the Ford truck, that's kind of a no-brainer isn't it? No bank loans for ford trucks, no money for Ford. It's in there best interest to finance you, and hell yes at a low rate. Now they have a repeat customer that otherwise didn't care for them.

Re: Credit Scores vs. FICO Score

Anonymous — Wed, 14 Jan 2015 19:28:28 GMT

@Anonymous wrote:
Let's not get too out of hand with this notion. Where did the figure of 95% of lenders using FICO come from? I'm pretty sure, no wait, I'd bet my last buck it's nowhere near that number. In fact other than the mortgage world, which way other lenders choose as their source is driven by so many different factors, Location being one of them. The lenders' current qualification levels, despite all the other lip dancing, comes down to supply and demand, That's the bottom line. They really don't care if a borrower defaults on a loan. What they really care about is whether or not one of the GSE's is in place to ensure their success, and compensate for any losses.

As for the guy with the Ford truck, that's kind of a no-brainer isn't it? No bank loans for ford trucks, no money for Ford. It's in there best interest to finance you, and hell yes at a low rate. Now they have a repeat customer that otherwise didn't care for them.

Not exactly sure what you are talking about but a LOT more lenders other than mortgage companies use FICO scores including the vast majority of credit card companies and the vast majority of auto finance companies use an auto enhanced FICO Score

Re: Credit Scores vs. FICO Score

Anonymous — Wed, 14 Jan 2015 19:31:39 GMT

It ain't the size of the boat that makes ya seasick...it's the motion in the ocean. It ain't the size of the scores that sell a lender, it's the activity going on under the sheets. The guy with the goal, of an 801...why? I'm in the 675 to 690 range, but I guarantee I can have the scratch for another house in hand by next Tuesday. With an 801, or even a high 700, you couldn't possibly have that kind of history. I'd damn near step out on a limb to say it's impossible. Numbers are good for them to help paint a picture of what kind of borrower you might be, because they don't otherwise know you. But you completely satisfy the terms of a mortgage...you got no more worries. But hey, keep pruning the limbs of those little unsecured loans and 25% credit cards. They don't matter. Call me on it if you want, but I give a dollar to a dime I can show you how to take 10 of those cards totally maxed out, put a little spit and elbow grease to them, and I'll make it look like your grammas underwear drawer, all folded and neat

Re: Credit Scores vs. FICO Score

Anonymous — Wed, 24 Jun 2015 20:50:17 GMT

@Anonymous wrote:
@Anonymous wrote:
@Anonymous wrote:
Let's not get too out of hand with this notion. Where did the figure of 95% of lenders using FICO come from? I'm pretty sure, no wait, I'd bet my last buck it's nowhere near that number. In fact other than the mortgage world, which way other lenders choose as their source is driven by so many different factors, Location being one of them. The lenders' current qualification levels, despite all the other lip dancing, comes down to supply and demand, That's the bottom line. They really don't care if a borrower defaults on a loan. What they really care about is whether or not one of the GSE's is in place to ensure their success, and compensate for any losses.

As for the guy with the Ford truck, that's kind of a no-brainer isn't it? No bank loans for ford trucks, no money for Ford. It's in there best interest to finance you, and hell yes at a low rate. Now they have a repeat customer that otherwise didn't care for them.
Not exactly sure what you are talking about but a LOT more lenders other than mortgage companies use FICO scores including the vast majority of credit card companies and the vast majority of auto finance companies use an auto enhanced FICO Score
(Mod Cut - Non FSR)

This is all so funny to me. Makes me think a that jingle "Potato Patatta, tomato, tamata...", or is it a PC or a Mac? All I know is you slice either one of them dirty little buggers up and toss 'em in hot grease, you get french fries. And PC or Mac are both conputers. The little apple on the lid don't mean it's a Mac.Just means it resembles one before you turn it on.

And so I wonder, do people know what a FICO is? Is it different than a credit score? If you use one system to put one together, and a different one to put together the rest, then mix them both up together, did the information change? Hell I don't know. Like I said, I don't care. What I do know is the same three companies crunch 'em both ways, and none of them ever match each other. Which one is right? Which one is better? Lenders that hand out that green stuff choose one over the other based on what? Who knows, but I know if I was going to pay someone to let me know when my fires had enough salt, and had just three idiots to choose from, I'd use the same idiot every time so all my fries were the same. But whether or not he useed his right or left hand to shove them in his face I'm pretty sure wouldn't change his answer.

But since I know that FICO is just a method to create your CREDIT SCORE from the information on your CREDIT REPORT, and I know it isn't an exact science, because three people see the same numbers, then must use their own magic math equations to come up with three different results. In the end, it doesn't work anyway, because the dumb hick with the 600 pays his house off, and the college yank in the pretty pink sweater has to box up those worthless degrees and get out before the bank takes back his and his boyfriend's cute little apartment overlooking the city. And that's about all on that.

Re: Credit Scores vs. FICO Score

Anonymous — Wed, 24 Jun 2015 18:48:31 GMT

"Vantage is 501-990 vs. FICO's 300-850. It's easy to see large differences in score."

Vantage 3.0 uses the standard 300-850 scoring system now.