It’s Your Score… but it’s not Available to You

What are your digits? I don’t mean your phone number. I mean the numbers any lender will want to see before they finance a car or a home… or plastic surgery… whatever you may need money for.

The 3 credit bureaus, TransUnion, Equifax and Experian have always sold your FICO score to consumers so you’ll know what potential lenders are seeing.  But now Experian won’t share the score with consumers.

Check out the article that appeared in “The New York Times” below to find out why.  

 By TARA SIEGEL BERNARD

 Published: February 4, 2009

Most consumers are about to lose access to one version of their all-important credit score.

Fair Isaac, the company that conceived the score known as FICO, says Experian, one of the three major credit bureaus, will no longer allow it to sell scores based on Experian’s data.

But Experian itself will continue to sell FICO scores based on its data to lenders, so some banks may make credit decisions, at least in part, on a score that consumers can no longer see.

Consumers have three FICO scores, based on the data provided by each of the three national bureaus, including TransUnion and Equifax.

Currently, individuals can visit a Fair Isaac site, myFICO.com, and purchase one or all of their FICO scores. As of Feb. 14, however, consumers will be able to see only the scores based on data provided by TransUnion and Equifax.

The decision comes as lenders are raising their credit standards, making it more difficult to qualify for all types of credit, from credit cards and auto loans to mortgages. And as the economy has deteriorated, the definition of a good score has inched higher. Getting the best rate on a loan — or any loan, for that matter — can be a matter of a few points. The median FICO score is 720, while the scale ranges from 300 to 850.

“We are surprised that Experian made such a decision, particularly given what’s going on in the national economy and with consumers being concerned about their credit standing,” said Tom Quinn, vice president for scoring at Fair Isaac. “Their decision means that consumers will no longer be able to see or manage their scores based on the Experian data.”

Experian cannot distribute its FICO scores to consumers itself or through other outlets, Mr. Quinn said. Experian does produce another proprietary three-digit credit score and make it available to consumers, but it is not the one that lenders base their decisions on.

Experian did not return several calls seeking comment, and it was not immediately clear what spurred Experian to cut ties with myFICO.com. But John Ulzheimer, president for consumer education for Credit.com, pointed out that Fair Isaac was ultimately one of Experian’s competitors.

Moreover, Fair Isaac has a pending lawsuit against Experian: in 2006, Fair Isaac sued all three credit bureaus, along with VantageScore Solutions, a joint venture of the three agencies with its own credit-scoring model, alleging that they had engaged in unfair competitive practices that harmed the FICO brand. Fair Isaac agreed to drop Equifax as a defendant in June, but the lawsuit is still pending against the others.

“The move isn’t unexpected, given the contentious nature of the lawsuit and the millions of dollars of credit score revenue that Fair Isaac recognizes each quarter from their partnership with Experian,” Mr. Ulzheimer said. Moreover, “Experian has made a significant monetary investment in the market for consumer credit reports and scores. Fair Isaac is a competitor of theirs, so this eliminates one component of the competition.”

Mr. Ulzheimer noted that it was consumers who would suffer the most. “This isn’t hurting Experian at all, it hurts Fair Isaac a little bit, and it hurts consumers a ton,” he added.

The majority of lenders use FICO scores to determine how risky a borrower will be, although many banks have added their own methods of verifying borrowers’ worthiness as the economy has weakened.

FICO scores have become more widely available in recent years. Last month, members of the Pennsylvania State Employees Credit Union with online checking accounts gained access to their FICO scores, based on Experian’s data. That arrangement does not appear to be affected by the cutoff of Experian data to Fair Isaac itself.

Holders of cards issued by Washington Mutual, which was recently acquired by JPMorgan Chase, have access to their scores, too. But Chase is considering taking this feature away and instead charging for a credit-building tool that includes the score.

Without ready access to FICO scores based on Experian’s data, consumers can at least check their Experian credit reports periodically to be sure there are no errors. All consumers are entitled to a free copy of their credit report, once a year, from each of the three bureaus, but the reports must be requested through the Web site annualcreditreport.com.

Consumers in the market for a loan might want to purchase the Experian-based FICO score before it goes away for good.

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One Response

  1. In general, If a consumer obtains the FICO score from both Trans Union and Equifax they should get a fairly good interpretation of what the credit score will be at Experian. Generally in the Houston market both Experian and Equifax carry the same information (as both are the longest running agencies in the area and thus have built some good data, and both most likely carry the major national companies which report to all 3 agencies) so there shouldn’t be much variance.

    It’s a shame that Experian is doing this to help push the VantageScore (with a score range that is not in sync with FICO) and could be misleading to consumers who think they may have a high score based on the VantageScore report that may not correlate into the same type of score on the FICO system and could lead to issues when attempting to obtain credit.

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