topic Mortgage Fico score vs myfico score in Mortgage Loans

Mortgage Fico score vs myfico score

Anonymous — Thu, 16 Sep 2010 01:33:28 GMT

After talking to many banks, I have been told that they do a Mortgage Fico Score not a Consumer Fico Score (myfico). So after some quick research at fico.com found that their is a mortgage score?

I found a house that we want (wasnt looking for one) and it is a great deal. We went for pre approval and was denied, under 620. A couple of years back cancled all credit cards paid in full, paid any loans in full and closed. I deceided to only buy things with cash. I have one credit card with only a 1500 limit. it was 50percent charged, we paid it down to 30%.. did some disputes and piggy backed off of another account.

My fico scores show the are above 620 (TU634 and EQ 644) but the banks are telling me they arent the same scores. any info would help

Re: Mortgage Fico score vs myfico score

Anonymous — Thu, 16 Sep 2010 03:06:02 GMT

hello.. from what i have experience my transunion score on myfico is about 20 to 30 points higher than what a lender has. my eq score is dead on the money. myfico still use the transunion 98 score model while most lenders are using the transunion 04 model.

Re: Mortgage Fico score vs myfico score

Lel — Thu, 16 Sep 2010 03:27:38 GMT

Hi nmknight, and welcome to the FICO Forums.

For EQ, the vast majority of mortgage lenders pull the Beacon 5.0 score, which is the same version that you get on this site. If you and your lender pull EQ scores on the same day, then they should be identical. There are probably some lenders that have moved on to a newer EQ version, Beacon 9, but as of yet their numbers are few.

For TU, as mentioned the version sold here is the TU98, whereas most (but not all) lenders have moved on to the TU04 version. There's unfortunately no way to predict whether your TU04 score is going to be higher, lower, or almost the same as your TU 98 score.

Experian FICO scores, as you've hopefully figured out by now, are not available for purchase. Any EX score that you get from a site such as annualcreditreport.com or even the Experian website is not an actual FICO score.

Re: Mortgage Fico score vs myfico score

Anonymous — Fri, 17 Sep 2010 03:15:43 GMT

thanks for the info. the last credit report they ran was beacon 5 and coouldnt fiqure which version of transunion they were running though. The problem is that every lender we talk to really doesnt know much about credit scores. its very frustrating.

Re: Mortgage Fico score vs myfico score

Lel — Fri, 17 Sep 2010 03:38:18 GMT

Some lenders are very knowledgeable about scores, others are not. In general, be wary of any advice that a LO gives you about how you might boost your score. Sometimes it can be patently bad advice - like the frequent suggestion to open up new credit cards just before applying. Moves like this can't be undone.

Re: Mortgage Fico score vs myfico score

Anonymous — Fri, 17 Sep 2010 15:54:33 GMT

Lel, on that note--and this could probably be a seperate topic, I know lol, but I have had a LO giving me some advice. My scores were terrible in june--she pulled me at EQ 456 TU 496 and EX 602, but this was before any paying, disputing, deleting etc. I have scorewatch and as of this weekend EQ 480 and myfico's TU was 570 and I don't know what EX is.

This was the info she gave me: Pay off, delete, settle, all of what i have on my CRs. Which I've been busting my hiney on and will have done by the end of Dec this year. I don't have any CC's at all so she said open 2 secured cards with 500 limits and don't charge more than 100 bucks or so and pay it off every month. With this she thinks my scores should be in the "financeable" range by the end of next year.

With this in mind we were going to start looking for Lease Option homes with a 2 year contract just to be safe. Is it possible I'm being fed a line here?

Re: Mortgage Fico score vs myfico score

Lel — Fri, 17 Sep 2010 16:46:59 GMT

@Anonymous wrote:

Lel, on that note--and this could probably be a seperate topic, I know lol, but I have had a LO giving me some advice. My scores were terrible in june--she pulled me at EQ 456 TU 496 and EX 602, but this was before any paying, disputing, deleting etc. I have scorewatch and as of this weekend EQ 480 and myfico's TU was 570 and I don't know what EX is.

This was the info she gave me: Pay off, delete, settle, all of what i have on my CRs. Which I've been busting my hiney on and will have done by the end of Dec this year. I don't have any CC's at all so she said open 2 secured cards with 500 limits and don't charge more than 100 bucks or so and pay it off every month. With this she thinks my scores should be in the "financeable" range by the end of next year.

With this in mind we were going to start looking for Lease Option homes with a 2 year contract just to be safe. Is it possible I'm being fed a line here?

The moves suggested here can have mixed results, depending on how they are pursued and what types of accounts they are.

For collection accounts, paying them off typically brings the "date of last activity" to the present, so even though a collection account is marked as paid, it will continue to have a negative effect on your score, and may be worse because of the more recent DOLA. The best course of action would be to negotiate at pay-for-delete. CAs are under no obligation to delete, but many people have reported success is getting the CAs to do so.

If by settling an account you mean paying less than the owed amount and then closing an account, this can have a detrimental effect on scores if the lender marks your account as "settled for less than the amount owed" or something similar.

Disputing accounts in attempt to get them deleted can backfire, especially they are legitimately your accounts. In addition to being unethical, having open disputes on your account can sandbag your mortgage application. And you can't easily say, "I no longer wish to dispute this account" and expect it to go away, as some recent threads have painfully demonstrated.

Lastly, opening new credit cards shortly before applying for a mortgage is generally regarded as a no-no. But since you had no CCs whatsoever, then in theory it would be good to demonstrate proper management of these accounts. However, your score will get dinged by the inquiries, new accounts, and decreased average age of account, and the mortgage lender might not consider a 6 month history of on-time payments to be sufficient evidence of good management of credit.

For specific advice about how to improve your credit scores, I'd recommend posting over on Rebuilding Your Credit with details about the derogatory accounts that you're dealing with. You'll get much more specific advice about the best way to proceed, though some things that you have already done probably can't be undone. Good luck.

Re: Mortgage Fico score vs myfico score

Anonymous — Fri, 17 Sep 2010 17:14:34 GMT

Not sure if this helps but less than 2 years ago our credit was bad, large balances, late payments, etc. We decided to use our tax return money to settle our accounts for less than what was owed, usually about 60% of the balance. And yes, while our credit did take a hit for doing so it was only for a few months. Shortly thereafter we were approved for a non-secured account. Then last June we were approved to refinance our house at 4.75%. Then just this past Feb. we bought a brand new car with only 3.9% interest. And just yesterday we were approved for an American Express credit card, which surprised even me as this is one of the creditors we settled with less than 2 years ago! Our scores are between 640 - 715 so it goes to show you, sometimes settleing can be in your favor! In our case, it was certainly better than carrying those balances for years or even worse, being unable to pay. I'm glad we did it and now our finances are in great shape. Just some food for thought.

Re: Mortgage Fico score vs myfico score

Anonymous — Fri, 17 Sep 2010 18:09:01 GMT

Thanks Lel, I read the rebuilding forums quite regularly. I don't know if i had mentioned this but I don't plan to go for financing for 2 years.. The plan the lender had was to pull everything in Dec. to see where we stand from the work I started in June (knowing that even then not everything will have been updated) and then just sit back, pay everything on time, no new inquiries, no new accounts--maybe try to send Good Will letters to those that wouldn't delete, no disputes and then at the 2 year point apply for the financing.

But once December comes and goes I'll be hands off other than to pay my bills on time every month.