Beacon Score vs. FICO Score
Page 1 of 2 1 2 LastLast
Results 1 to 10 of 20
  1. #1
    Join Date
    Jul 2001
    Posts
    179
    What is the difference between these two scores? Are there two seperate algorithms? I've spoken to reps from two different financial loan institutions, and they've assured me that there IS a difference between your FICO socre and your Beacon score.. hmmm...

    jmart


  2. #2
    Join Date
    Feb 2002
    Posts
    472

    Re: Beacon Score vs. FICO Score

    Beacon score is equifax own private scoring system. Definitely different from Fair Isaac:

    http://www.creditnet.com/Credit_Serv...t_Products.php

  3. #3
    Join Date
    Dec 2000
    Posts
    1,847

    Re: Beacon Score vs. FICO Score

    Okay, I am really confused I always thought that Beacon was a Fair Issac score, Emperica was the TU version from Fair Issac, and Experian's Fair Issac, was also Fair Issac. Am I wrong?

    Dani
    To repeat what others have said requires education; to challenge it, requires brains. (Mary Pettibone Poole)

  4. #4
    Join Date
    Jun 2001
    Posts
    1,260

    Re: Beacon Score vs. FICO Score

    Dani....

    Yes and no. The Beacon (and the others) is Equifax's customized FICO. FICO is generic and the basis for the Beacon and other scores.

  5. #5
    Join Date
    Mar 2002
    Posts
    259

    Re: Beacon Score vs. FICO Score

    Well,
    I found this is the FAQ section on myfico.com:

    What do I get when I order Score Power?


    You receive a package of information including your BEACON/FICO score, the Equifax Credit Profile‚?Ę on which your score was calculated, and a personalized analysis of your score.

    Will ordering cause my FICO score to drop?


    No. Ordering your own Equifax Credit Profile and BEACON/FICO score through this service will not change your score.

    Which credit reporting agency should I select?


    While all three major credit-reporting agencies offer FICO scores for making credit decisions, only the BEACON score from Equifax is available for purchase by consumers.

    So, they are saying that their score is your BEACON score.

  6. #6
    Join Date
    Apr 2002
    Posts
    754

    Re: Beacon Score vs. FICO Score

    Q "What is the difference between these two scores? Are there two separate algorithms? I've spoken to reps from two different financial loan institutions, and they've assured me that there IS a difference between your FICO score and your Beacon score.. hmmm..."



    FICO is short for Fair Isaac and co. This company creates credit risk models.

    Fact: Most basic credit scores are what is termed a FICO score. Only scores that takes the following criteria into account are considered FICO scores. http://www.myfico.com/MyFICO/CreditC...ICOFactors.htm

    Also consider that FICO scores ignore things like having a job, how much you make and your age. See http://www.myfico.com/MyFICO/CreditC...ICOIgnores.htm

    Now there are many versions of FICO scores and there are several basic types.

    The three major types are:
    1 FICO (used with credit cards).
    2 Bankruptcy (used for mortgages and auto loans).
    3 Profitability (used to see if they can make money off of you). Weed out the free riders.

    Now there are three major credit bureaus and they all sell credit scores to consumers and lenders:

    CRA name------Consumer score name---------------------Lender score name


    Equifax------------Beacon/FICO score---------------------------Beacon

    Experian----------Experian credit score-------------------------Experian/Fair Isaac Risk Model score

    TransUnion------Trans Union personal credit score---------Empirica score

    Now a real FICO score uses a scale from 300 to 850 where 661 or 681 is very good and great respectively. When a lender pulls a FICO report they get a FICO score on this scale that has a name that varies depending on what bureau they pull from. Each CRA sells 12-15 different kinds of credit scores.

    Equifax's personal credit score is the same as the one they sell to lenders.

    TransUnion sells consumers a score on a scale of 150 to 934.

    Equifax sells consumers a score on a scale of 340 to 820.

    Now if this is not complex enough, Fair Isaac could sell a mortgage company a risk score that would fall into the bankruptcy type. This would technically not be called a FICO score even though it came from Fair Isaac. This type is used to see the odds that you will declare bankruptcy and is used in applying for a mortgage. They usually pull all three of your FICO scores first and take the middle number. Then they plug in the data you give them about income, debt ratios Etc.

    To make things even more complex, some lenders such as auto dealers are using older FICO credit scores on potential borrowers in conjunction with other data to come up with a number that means something to them and nothing to the rest of the world.

    With all the complexities of credit scoring don't be surpassed if the average credit rep is clue-less as to what is actually going on.
    Erik.