I am convinced the FICO algorithm is fixed..

[MarineVietVet]

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@striders wrote:

Your comparison with the college quiz and/or grade failed. In college, you KNOW what is the OUTCOME of your grade or quiz if you miss xx points or questions. You CAN bring your grade UP if you study hard and aced future tests.

With credit scoring, you DO NOT know EXACTLY what would happen when you do certain things related to your financial.

My take? Credit scoring EXIST to benefit big banks AND **bleep** customers. Take a look at Experian FICO scoring: they no longer sell that to public. So if I apply for a credit and qualify for 5.99% but the bank said my Experian score is "low" and I only qualify for 9.99%, there is nothing I can do because I do not know the score.

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I can only speak of my limited experience but my credit and money management fortunes have always been directly tied to both my bad and good decisions. When I have made the wrong moves (late payments, too much CC debt, my BK, etc.) my scores have suffered.

Once I woke up and

Started paying everything on time,

Stopped overextending my CC usage,

Lowered my CC utilization to where it needed to be,

Waited for all my negatives to be gone (this was way before I knew about GW's, PFD's, DV's, etc.),

Stopped applying for credit just because I could 

My scores have done nothing but go up.

It's not always been easy and I continue to make many mistakes but I truly believe we all can be in control of our credit.

From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

[Anonymous]

First of all you do not need to talk to me that way, second of all I didn't think a 10 point quiz would bring down my grade 2 points. A lot of things work that way. Just because YOU think theres a conspiracy going on doesn't mean you need to belittle my point. I was trying to be friendly and help.

[Anonymous]

I am not trying to put the tinfoil hat on but what I find interesting is amid all of these defaults and the mortgage crisis that the average credit score would be in the tank, yet nobody has said it is and they still insist the average median credit score is still above 700. I HIGHLY doubt that. I am a firm believer that since we all know Wall-Street is rigged (you should know by now, if not read up on speculation and hedge funds and get back to me...look at the price you are paying at the pump and well THAT is the result of speculation and NOT basic oil supply and demand which should be ILLEGAL) and there is NO reason to not think that the single most important factor (regardless of what the banks and lenders want to say about FICO scoring or any other proprietary scoring method as being just a single factor in determining your creditworthiness...BS!!!) in determining what RATES you pay is not fixed. I am all about paying for my financial transgressions but the simple fact of the matter is besides my BK in 2004, I have ZERO negative accounts on my report and nearly 7 years of 25+ accounts that show either PIF with no missed payments or no missed payments with small balances. I just paid off nearly 20k in bills in the past 2 months and my score went DOWN? 4 inquiries in the past year, length of credit file (ironically the length of my file shows up on BOTH a positive and negative factor!?!?!) and 23% of revolving debt as compared to 48% is somehow dropping my score 30 points! Now mind you, the last quarters FICO summary didn't have the length of credit as a ding and in previous reports anything under 30% actually showed me in a positive light. Maybe my file went into another bucket but come on, the 670 bucket cannot be all that great of a bucket in terms of people with impeccable history that I am competing against.

[creditchild]

marinevet with all due respect that works in a perfect world. but i have done some if not all the things you've accomplished

and still my score is in the late 600's. i think the scoring stuff is meant to keep some of us down. i mean think about it, if everyone

had perfect scores banks,etc couldn't make money. so it makes sense for them to keep coming up with this stupid way of doing credit

scoring. i just spoke to a person at my bank(credit union) this morning and she said experian sent them something this morning saying

they were changing score models again. she said they were still using the old model. like i said its meant to keep you down,thats why they

compare you with whats going on with people accross the world. and thats why these credit bureaus have no one to regulate them. its sad.

[MarineVietVet]

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@creditchild wrote:

marinevet with all due respect that works in a perfect world. but i have done some if not all the things you've accomplished

and still my score is in the late 600's. i think the scoring stuff is meant to keep some of us down. i mean think about it, if everyone

had perfect scores banks,etc couldn't make money. so it makes sense for them to keep coming up with this stupid way of doing credit

scoring. i just spoke to a person at my bank(credit union) this morning and she said experian sent them something this morning saying

they were changing score models again. she said they were still using the old model. like i said its meant to keep you down,thats why they

compare you with whats going on with people accross the world. and thats why these credit bureaus have no one to regulate them. its sad.

---

All I know is that it can be done and anyone can repair and rebuild. I am living proof of that. I was as far down financially as one can get I suspect but I never saw myself as a victim and I was determined to fight back. No person or company or scoring system was to blame for my money problems. I brought all of them on myself. My world is not perfect by any means. I make bad decisions all the time.

And with all due respect to you I never have and never will believe that some people are meant to be or picked out to be or destined to be "held down". While I freely acknowledge that bad and unforeseen things happen to all of us in the end we are in charge of our lives for the most part.

I also believe that education is the key. No one will ever have all the answers but if we keep moving forward we can do just about anything. Anyone can learn to work the system and not let it work you but it does take hard work and it does mean backward steps from time to time.

From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

[striders]

If I read the postings correctly, I think what OP is trying to say is that the "punishment" for having bad credit is so severe that it impacts the individual for a long time, even if said individual do honestly try to fix the problem, while the bank is making money out of this situation.

For example, if I have bad credit due to my own fault 5 years, ago, why should I be punished for having that bad credit for 7 years AND have FICO calculate that for years (3 years? 4 years?). Even if I paid off the bad credit, the scoring system will see that I DID have bad credit and reflected that in the score. I will end up paying far more money to the banks.

Now let's compare that with the recent financial meltdown (mortgage crisis, etc.). What happened next? The big bank execs and their underlings all run to the Feds and GOT A LOAN from the Feds. With that loan, the banks can "fixed" their business and remain in the business.

In the 2 examples above, both made a bad financial decisions, both need a loan, but who got the better deal?

If FICO will have some calculations that, for example, "ignore" or reduce the impact of such bad account after certain time period (2 years), then it will be better.

[Anonymous]

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@Anonymous wrote:
I am not trying to put the tinfoil hat on but what I find interesting is amid all of these defaults and the mortgage crisis that the average credit score would be in the tank, yet nobody has said it is and they still insist the average median credit score is still above 700. I HIGHLY doubt that. I am a firm believer that since we all know Wall-Street is rigged (you should know by now, if not read up on speculation and hedge funds and get back to me...look at the price you are paying at the pump and well THAT is the result of speculation and NOT basic oil supply and demand which should be ILLEGAL) and there is NO reason to not think that the single most important factor (regardless of what the banks and lenders want to say about FICO scoring or any other proprietary scoring method as being just a single factor in determining your creditworthiness...BS!!!) in determining what RATES you pay is not fixed. I am all about paying for my financial transgressions but the simple fact of the matter is besides my BK in 2004, I have ZERO negative accounts on my report and nearly 7 years of 25+ accounts that show either PIF with no missed payments or no missed payments with small balances. I just paid off nearly 20k in bills in the past 2 months and my score went DOWN? 4 inquiries in the past year, length of credit file (ironically the length of my file shows up on BOTH a positive and negative factor!?!?!) and 23% of revolving debt as compared to 48% is somehow dropping my score 30 points! Now mind you, the last quarters FICO summary didn't have the length of credit as a ding and in previous reports anything under 30% actually showed me in a positive light. Maybe my file went into another bucket but come on, the 670 bucket cannot be all that great of a bucket in terms of people with impeccable history that I am competing against.

---

I'd never be a person to say that the credit scoring system isn't flawed-- I firmly believe that it is, and I could give Fair Isaac about 6 million tips on how to make it better.

But--

Sometimes things aren't as muddy as they might appear to be at first glance. While we don't know (but wouldn't we love to?) the FICO scoring algorithms, and we don't know nearly enough about the scoring buckets, we do know some very important truths.

• Public Records (judgments, liens, bankruptcy, etc...) hurt.... badly. And, the pain (while it does lessen over time) hangs on for the duration. As long as you have a PR, you'll be in the worst derog bucket. Your positve payment history after the PR will allow you to climb to the top of the bucket, amongst credit peers who have a PR, but flawless history since. Still, that PR is a predictive caution to current and future lenders that there is an increased risk of default amongst people who have credit profiles similar to yours. Current & future lenders take that information, and do with it what they want. Some won't play ball at all. Some will play, but make you pay (extra). And some will look at the overall picture and say, "Ya know, Maxedout had a single big event that led to that PR, was solid before, and solid since. It's not really predictive of future default in this *specific* case. Let's play ball."

• Opening new accounts gets you dinged for new credit, INQs, and lowered AAoA. As IIecs mentioned earlier in the thread, our FICO highest achievers aren't usually adding new credit, frequently enough have account histories older than I am, and average age of accounts greater than yours (and mine). But, time does soothe these wounds.

• Greater than 20% utilization is still on the high side, especially for some profiles. The High Achievers have utilization somewhere in the 7% range. You may need to get below that 7% threshold. My personal "sweet spot" is between 3 and 5%.

But, I think that Marinevietvet has put it best-- Let time do its job. The bankruptcy will fall off in another few years, and you'll be rebucketed again. Continue to pay, on time. Payment history is the single greatest input into your credit score. Keep your debt in check. Be aware of your debt & utilization, and how it might impact your financial life, and keep them both low. Apply for credit judiciously. Give it some real thought before applying for credit, and try not to do so too often. There is absolutely no doubt, without regard for how unclear the specifics of credit score are, that following these rules will result in increased scores.

[Anonymous]

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@striders wrote:

If I read the postings correctly, I think what OP is trying to say is that the "punishment" for having bad credit is so severe that it impacts the individual for a long time, even if said individual do honestly try to fix the problem, while the bank is making money out of this situation.

For example, if I have bad credit due to my own fault 5 years, ago, why should I be punished for having that bad credit for 7 years AND have FICO calculate that for years (3 years? 4 years?). Even if I paid off the bad credit, the scoring system will see that I DID have bad credit and reflected that in the score. I will end up paying far more money to the banks.

Now let's compare that with the recent financial meltdown (mortgage crisis, etc.). What happened next? The big bank execs and their underlings all run to the Feds and GOT A LOAN from the Feds. With that loan, the banks can "fixed" their business and remain in the business.

In the 2 examples above, both made a bad financial decisions, both need a loan, but who got the better deal?

If FICO will have some calculations that, for example, "ignore" or reduce the impact of such bad account after certain time period (2 years), then it will be better.

---

Because FICO scoring is not designed to reward us (private individuals) for currently doing it right. It wasn't designed for "us" at all. It's a predictive risk assessment based upon past and current behavior in the general population. It was designed to assess risk for those who might extend you credit. That predictive analysis is tied to the histories of other people, with similar credit profiles and behavior.

I agree, whole-heartedly, that derogs impact credit for too long. But, I don't necessarily believe that it's a problem of FICO scoring... I think it's a problem of credit reporting. IMO, 7 to 7.5 years is disproportionately long. I think 3 years is long enough for the vast majority of derogs, and more than adequately "punishes" individuals who have righted their ship since the derog incurred. But, nobody listens to me...

[rdtech]

---

@MarineVietVet wrote:

---

@creditchild wrote:

marinevet with all due respect that works in a perfect world. but i have done some if not all the things you've accomplished

and still my score is in the late 600's. i think the scoring stuff is meant to keep some of us down. i mean think about it, if everyone

had perfect scores banks,etc couldn't make money. so it makes sense for them to keep coming up with this stupid way of doing credit

scoring. i just spoke to a person at my bank(credit union) this morning and she said experian sent them something this morning saying

they were changing score models again. she said they were still using the old model. like i said its meant to keep you down,thats why they

compare you with whats going on with people accross the world. and thats why these credit bureaus have no one to regulate them. its sad.

---

All I know is that it can be done and anyone can repair and rebuild. I am living proof of that. I was as far down financially as one can get I suspect but I never saw myself as a victim and I was determined to fight back. No person or company or scoring system was to blame for my money problems. I brought all of them on myself. My world is not perfect by any means. I make bad decisions all the time.

And with all due respect to you I never have and never will believe that some people are meant to be or picked out to be or destined to be "held down". While I freely acknowledge that bad and unforeseen things happen to all of us in the end we are in charge of our lives for the most part.

I also believe that education is the key. No one will ever have all the answers but if we keep moving forward we can do just about anything. Anyone can learn to work the system and not let it work you but it does take hard work and it does mean backward steps from time to time.

From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 2/11-816, TU - 2/11-782

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

---

I too strongly believe that anyone can repair and rebuild. As Marinevietvet mentions, education is the key.

I had absolutely no clue about credit at all for much of my college life and as such I comletely ruined mine. When I actually started to need it, I found that my score was so low that nobody was going to extend credit to me. I dug this hole for myself and now it was time to climb out! 2008 came along and I knew I needed to take action. After doing alot of research/searching, I found this site and never looked back. It's amazing the amount of information I learned here! I learned about FAKO vs FICO, GWs, DVs, PFDs, FICO Scoring and a ton of other information, but must importantly... that recovery was possible and there were dozens of demonstrated cases here in the forums and people that wanted to help!

Using the information I learned, I went from a low 500s score with many bad tradelines and no open credit in 2008 to as of yesterday's TU report 702 with only 2 remaining bad tradelines on my report!

We can't change the system, but with education you can make it work for you! I demonstrated this and I knew zero about how credit worked for much of my life. If I knew what I do now 10 years ago I would have socres in the 800s. Continue to educate yourself, continue to do the right things, and continue to use this site. You will succeed!

I did it, others did it, and you can too

[Anonymous]

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@rdtech wrote:

I too strongly believe that anyone can repair and rebuild. As Marinevietvet mentions, education is the key.

I had absolutely no clue about credit at all for much of my college life and as such I comletely ruined mine. When I actually started to need it, I found that my score was so low that nobody was going to extend credit to me. I dug this hole for myself and now it was time to climb out! 2008 came along and I knew I needed to take action. After doing alot of research/searching, I found this site and never looked back. It's amazing the amount of information I learned here! I learned about FAKO vs FICO, GWs, DVs, PFDs, FICO Scoring and a ton of other information, but must importantly... that recovery was possible and there were dozens of demonstrated cases here in the forums and people that wanted to help!

Using the information I learned, I went from a low 500s score with many bad tradelines and no open credit in 2008 to as of yesterday's TU report 702 with only 2 remaining bad tradelines on my report!

We can't change the system, but with education you can make it work for you! I demonstrated this and I knew zero about how credit worked for much of my life. If I knew what I do now 10 years ago I would have socres in the 800s. Continue to educate yourself, continue to do the right things, and continue to use this site. You will succeed!

I did it, others did it, and you can too

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Well said!