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Why is score different on decline letter?

dynamicvb
Valued Contributor

Re: Why is score different on decline letter?

Fico 9 is a total mystery to me. I've seen several here that remark their Fico 9 scores are in line or higher than 8, but that is not the case with me at all. With the exception of TU, mine are all 30-40 points lower on version 9 than version 8. I can only surmise that it places more emphasis on certain baddies than 8 does. My TU is a just little lower than 8 and its the only report where I have all my baddies gone.

 

I would be interested in others take on this scoring method too.

Started Rebuild 4/2018: EX 616| TU 604| EQ 621

Current 5/28/20:


First Goal Score: 750+ Reached 3/2019

Next Goal all over 800
Message 11 of 17
Brian_Earl_Spilner
Community Leader
Mega Contributor

Re: Why is score different on decline letter?


@dynamicvb wrote:

Fico 9 is a total mystery to me. I've seen several here that remark their Fico 9 scores are in line or higher than 8, but that is not the case with me at all. With the exception of TU, mine are all 30-40 points lower on version 9 than version 8. I can only surmise that it places more emphasis on certain baddies than 8 does. My TU is a just little lower than 8 and its the only report where I have all my baddies gone.

 

I would be interested in others take on this scoring method too.


It wouldn't be higher for you based on the derogatories, it would be lower. It does score you higher than fico 8 once the derogatories are paid.




Message 12 of 17
james3332
Regular Contributor

Re: Why is score different on decline letter?

So the only thing that can be done to improve a FICO 9 is to get derogatories removed? There are no other factors that go into this score?
Message 13 of 17
NRB525
Super Contributor

Re: Why is score different on decline letter?

When you have baddies, that is the major ceiling on your scores.

At its root, the reason FICO and other scores exist, is to measure of risk, risk that the borrower may not pay back the loan. As soon as loan or CC terms are violated by paying late, that significantly raises the risk to lenders that the borrower will fail to pay. Score is panalized.

If FICO 9 factors in that a debt was ultimately paid to zero, that allows the person to pay off the debt without going through the chore of getting the late itself deleted. While this improves FICO 9, the older algorithms are still very much affected by the late if it is not deleted.

Once you get all the lates handled, either paid or PFD, then you will see a score improvement. After that, factors like utilization become more important.
High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
March 2021 $33k on $312k EQ 796 TU 798 EX 801
May 2021 Paid all Installments and Mortgages, one new Mortgage EQ 761 TY 774 EX 777
Message 14 of 17
dynamicvb
Valued Contributor

Re: Why is score different on decline letter?


@Brian_Earl_Spilner wrote:


It wouldn't be higher for you based on the derogatories, it would be lower. It does score you higher than fico 8 once the derogatories are paid.


Not necessarily. My TU is clean and its 6 points lower than my TU Fico 8. Version 9 does not follow the exact same rules as 8 and it must count newer accounts or inquiries more heavily as those the only potentially negative items on that CRA.

Started Rebuild 4/2018: EX 616| TU 604| EQ 621

Current 5/28/20:


First Goal Score: 750+ Reached 3/2019

Next Goal all over 800
Message 15 of 17
james3332
Regular Contributor

Re: Why is score different on decline letter?

Sounds like there is no clear understanding on how 9 is different than 8.  Sure makes it difficult to focus on stuff you can control in the short term vs. things that might not be within your power to control (such as not having the funds to pay off a collection).

Message 16 of 17
NRB525
Super Contributor

Re: Why is score different on decline letter?

Well the things you can control in the short term are the same for all models:
Don’t app / open new accounts unless there is a good financial reason.
Keep utilization low or work to pay down balances, especially on any high utilization cards.
Continue to pay all accounts on time every month.
Look for opportunities to get SP CLI on cards where those are available.
And, as you are already doing, try to resolve baddies off your file.
High Bal Jan 2009 $116k on $146k limits 80% Util.
Oct 2014 $46k on $127k 36% util EQ 722 TU 727 EX 727
April 2018 $18k on $344k 5% util EQ 806 TU 810 EX 812
Jan 2019 $7.6k on $360k EQ 832 TU 839 EX 831
March 2021 $33k on $312k EQ 796 TU 798 EX 801
May 2021 Paid all Installments and Mortgages, one new Mortgage EQ 761 TY 774 EX 777
Message 17 of 17
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