Is median Fico score of 720 accurate? Raves and rants

[Anonymous]

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@MidnightVoice wrote:

Cynical though I am, I think it is possible to have a median of 720 and an average in the 670s in the US.

In the US, the average age of people with credit scores will be in the 40s. Many of them have probably got over many of their financial troubles and got a mortgage and a family that is growing older. Many of them will have kids racking up student loans, but be OKish themselves. They will have long credit histories and very old cards

For that half of the population, a score of 678 or above will be reasonale.

And statistically, this board is NOT a representative sample

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I agree. Forums sometimes get a bit myopic - in our case, we need to remember that a large percentage of those with 750+ scores don't have concerns related to credit repair or credit improvement, and so never join a forum.

As for manipulation of the "official" median or average Fico score, I think that's more conspiracy theory than fact. If lenders want to restrict loans, or shift interest rates, they simply move the bar up or down as needed. Following the recent mortgage default news, different lenders changed the FICO score needed for different types of mortgages. A particular loan that required a 620 two years ago may require a 630 today. Nothing is based specifically on the median score number. Some mortgages require a 620+, others need a 730, while the best car loans are associated with 680+ or 690+.

[Anonymous]

I was just pointing out the simple fact that manipulation does exist and effect the majority of people so I was just trying to get a feel for what the "average" score is and I do realize that this forum wouldn't be a good sample but I did want to get some feed back and rave and rant about conspiracy. It's an unfair world and I think we all agree with it but as long as we can keep informed with these crooks and learn the system then we can have a better chance of being successful.

[VLGaffEsq]

Thanks for the laugh out loud you comment just gave me!

[Anonymous]

Actually, I'm sure they know a lot more about the distribution of scores than I do.

However, it is a curve with a long tail.

I should know, I started in the 2%.

[Anonymous]

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@MercyMe wrote:

Sigh ... and here I thought I was doing alright with a climbing 600 something. Guess not. )

What is the average credit score?The real median credit score (the one lenders use). Don't believe everything you read (particularly about average scores in the 670s).

"The Median FICO Score in the U.S. is 723." - Fair Isaac

Let's have a little fun. The day this page was first written is February 2, 2007, Groundhog Day. Here are a few of our friends saying what they think the average score is:

• Google: average credit score 678
• Yahoo: average credit score 678
• MSN: average credit score 678

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Median is different than mean (which is what most people mean by "average").

1/2 the population with scores has scores > 723. Half has less.

If you add up all the scores and divide them by the number of people with scores, you'll get 678.

Get the difference?

[Anonymous]

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@Anonymous wrote:
Did Fair Isaac's give a source or explain how they calculated this median?

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I'm guessing it's the same way everyone else calculates it.

Just a thought.

[Anonymous]

You know as I read over this, I cannot help but think about the reading scores at the school where I teach.  It is a brand new school, so we are meeting these kids for the first time.

After we got our overall test scores, it seemed that our students were about 1 year behind in reading, on average.  Yet when we closely examined the stats, we discovered that a *few* very strong readers were pulling up the average for everyone.  In truth, the majority of our kids were 2-3 years behind in reading.  Those handful of super bright kids (reading well beyond their grade level) were raising the overall score.

I think that FICO is like that.  I think it would be more accurate to report scores according to brackets of people- maybe according to credit history.  As a 31 year old, my credit is still shabby.  I am still paying off student loans, have very little equity in my home, and I'm relatively new to the workplace.  10 years from now, things will be very different for me.   Loans will be gone, over half of my home will be paid for, and my oldest accounts will be over 20 years.

So I think in 10 years, I will have an extremely high score, and it will counter a handful of scores from 20-30 somethings who are first starting out.

But I really do NOT think that 723 is representative of my friends and colleagues.  Of course, being a teacher who is friends with other teachers probably factors in as well.  We are hardly known for our *salaries*...hahahhaah!

[RobertEG]

What s being questioned here is the intergrity of the basic FairIsaac interpretation of data provided to them over millions and millions of prior credit reports, and their resulting interpretation of that data into a formula that predicts credit risk based upon past history. Sure, most  of the people I rub shoulders with every day may not be above the "norm" of 720, but I dont rub many shoulders in Manhattan or in Cape Cod.

I also dont believe that Fidel Castro shot JFK from the grassy nowl.

I trust FairIsaac, until shown otherwise with facts as opposed to dispersiions, that their risk analysis is based upon data, and not prejudice.

[RobertEG]

diggum, who are the "crooks" that you idlly refer to?

NO! I dont want an answer to that rhetorical question, for it would just wast a lot more of forum time.

I thing this entire thread is becoming more of a posture for venom than a sharing of facts and information.

Such idle and repeated allegations are not what this site is about.

Put up with facts, or shut up, please

[MattH]

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@Anonymous wrote:

Median is different from mean (which is what most people mean by "average").

1/2 the population with scores has scores > 723. Half has less.

If you add up all the scores and divide them by the number of people with scores, you'll get 678.

Get the difference?

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Many socioeconomic statistics, such as for example income, do not follow a bell curve but rather have what statisticians term a "skewed distribution." The mean income of a town, state, or country would be a highly misleading statistic because a small number of people with large incomes would add disproportionately to the total. Therefore many government statistical agencies give more emphasis to the median income than to the mean income. Fico scores must also be skewed, so I presume Fair Isaac reports median instead of mean for similar reasons.

http://en.wikipedia.org/wiki/Average