My wife's top negative factor: ------------------------------------------------------- You have recently been seeking credit or other services, as reflected by the number of inquiries posted on your credit file in the last 12 months You applied for credit 0 times in the last 12 months (remember, the FICO score incorporates logic that accommodates for mortgage and auto loan rate shopping). Research shows that U.S. consumers have, on average, applied for credit between just 1 and 2 times in the previous 12 months. Click here to review your Accounts Summary. Research shows that consumers who are seeking new credit accounts are riskier than consumers who are not seeking credit. Inquiries are the only information lenders have that indicates a consumer is actively seeking credit or other services. There are different types of inquiries that reside on your credit bureau report. The score only considers those inquiries that were posted as a result of you applying for credit or other services. Other types of inquiries, such as promotional inquiries (where a lender has pre-approved you for a credit offer) or consumer disclosure inquiries (where you have requested a copy of your own report), are not considered by the score. The scores can identify "rate shopping" in the mortgage- and auto-lending environment, so that one credit search involving multiple inquiries is usually only counted as a single inquiry. Typically, the presence of inquiries on your credit file has only a small impact on FICO scores, carrying much less importance than late payments, the amount you owe, and the length of time you have used credit. This reason rarely appears as a primary or secondary reason except in high-scoring files. A common misperception is that every single inquiry will drop your score a certain number of points. This is not true. The impact of inquiries on your score will vary - depending on your overall credit profile. Inquiries will usually have a larger impact on the score for consumers with limited credit history and on consumers with previous late payments. The most prudent action to raise your score over time is by applying for credit only when you need it. As time passes the age of your most recent inquiry will increase and your score will rise as a result, provided you do not apply for additional credit in the meantime. Our best recommendation - apply for credit only when you need it. ---------------------------------------------------- GO FIGURE...0 inquiries is TOO MANY...
ONE IS "JUST RIGHT" http://www.ftc.gov/bcp/creditscoring/present/sld008.htm ZERO TOO MANY<-----**** TWO-NINE TOO MANY
I've always said that. they make sure that they make one up even if they have to take a postive and twist it into a negative.
Re: Re: Re: FICO...does it make any sense ??? Those are very good scores. Credit reports always give reasons why the scores are not higher. When the scores are already high, the reasons given are nonesense reasons like that.
Re: Re: Re: FICO...does it make any sense ??? What I think doesn't make sense is why some people I've seen post here have bankruptcies from 2000 and I have just a small charge-off from 1998 and my score can be almost 75-100 points lower than theirs. Again, it just doesn't make any sense!
Re: Re: Re: FICO...does it make any sense ??? CREDIT SCORING 1 of 3 Fair Isaac comes out of the closet 1/13/01 - The mother of secretive credit scoring systems, Fair, Isaac Inc, has teamed up with Equifax to provide more information on your credit scores, reports Wired news. As the Federal Trade Commission said earlier this year, "The cat's out of the bag now". The change is welcomed, but we believe there is MUCH more to be disclosed and Victims are not going to like it when they find out how scores have actually been calculated. We all owe a big THANK YOU to E-Loan for their courageous stand. Credit Bureaus to provide credit scores 12/27/00 - Bankrate.com reports credit scores to be given to victims by July 2001. March 1, 2000 Eloan offers FICO Scores to consumers. Sit back and watch Fair, Isaac try to explain why you are way too dumb to understand your own credit score. And is your final score all they are hiding? March 1, 2000 Equifax Brags about denying telephone service based on information not in your credit report. Our claims that scores are based on nondisclosed data have been verified. Is the government listening? Want to know more about "The Worlds 2nd Oldest Profession"? Read The Fortune Sellers : The Big Business of Selling and Buying Predictions by William Sherden. What are credit Scores? By the time you have found this page you have probably already read the many general credit scoring publications assuring consumers that credit scores are accurate and fair. Now it is time to step back and consider the real history and purpose of both credit reporting and credit scores. In the real world credit scoring has already replaced your right to a fair civil trial. When you try to open a credit account, apply for a telephone, write a check or use a credit card, the evidence for and against you is weighed by a computer. If any business anywhere feels you have offended them that accusation is considered by the computer without regard to any protest or defense you can make. By collaborating with each other the consequences of a guilty verdict in this electronic courtroom have been made more severe than the same verdict in a legitimate trial. Businesses have always been frustrated with courts because juries see things from the consumers point of view. It really bothered businesses that claims had to be legitimate and provable to be enforced. Credit reports and computerized scoring provided the perfect answer. Once US businesses agreed to form their own justice system they no longer had to have proof nor rely on juries to deliver - - now the accusation is the verdict and it is all done with the push of a button. Do credit scores actually work? Not really. If the purpose of scoring is to prevent defaults or improve access to credit they have failed miserably. As the scoring fad became popular bankruptcies and home mortgage defaults shot off the chart. (The best economy in US history has not stemmed this tide.) Promises by credit report/score salesman that scoring would make it easier for millions of "marginal" applicants to get credit also proved false. Not too long ago credit reports and scoring were touted as a way to speed up credit approval. Now home buyers spend more time arguing with credit bureaus then selecting a home. What about "Inquiries"? The bureaus will tell you that you cannot challenge inquiry information because bureaus are required by law to report inquiries. This is just another credit bureau lie. There is no legal requirement that credit bureaus tell anyone but you about inquiries. The real reason bureaus report inquiries is to give collection agencies a way around the Fair Credit Reporting Acts seven year time limit on negative information. If you have been told your score was low because of "too many inquiries" look for the phrase "Collect" in the inquiry section. If you find it you have been blacklisted by a bill collector. A single inquiry of this type usually dooms your application for two full years. This phrase appears on each inquiry from collection agencies without regard to the validity or timeliness of debts they are supposedly investigating. This is a way for vicious collectors (who cannot win in a fair trial) to destroy your credit for life just making by such an "inquiry" every two years. If we apply enough pressure this illegal acitivty can be stopped. Collection inquiries should immediately be reported to the FTC through your Congressmans office. The following is from our amicus brief in the case of Bill Sheehan: "Any indication of negative credit history without meeting the full disclosure and time limitation requirements of the Fair Credit Reporting Act has been held to be a per se violation of the FCRA. Defendant credit bureaus have attempted various schemes to override these consumer protections and the Federal Trade Commission has obtained decisions and orders prohibiting very similar conduct. vol 96 FTC 911-90 in the matter of Equifax inc. ""The limiting use of this stock sentence to those situations where adverse information had been uncovered indicates that its use was intended as a signal to disclose the existence of such information. The practice violated Section 605 of the FCRA."" What influences my credit score and how? Nobody seems to know. Even the scoring companies claim they can't tell what influence a particular factor has on our scores. Congress has not required credit scoring source code to be published, nor even required companies to tell us where the data they looked at came from. Credit reports are the only exception and modern scoring systems are using far more information about us than can be found in credit reports alone. It is probable that marketing lists and shopping habits will have an increasing effect on your credit score. Some of the items that make up your score are obvious (your debt load) and some make as much sense as reading tea leaves (the model or year of the car you drive is common). In the end your entire existance is reduced to a single number that results in a "yes" or "no" answer. "Yes" results often get further study before you are accepted. "No" applicants are nearly always dropped from consideration without human intervention. Is this scientific? Humans make pay/do not pay decisions for a variety of reasons. Since credit scoring systems were designed to place blame on the individual and ignore the institutions role, it is necessary to violate basic laws of science to make sellable predictions. Some of the laws frequently violated are: Occam's Razor, often stated as "In inductive reasoning, use all, but no more than, the available information." While scoring systems ignore a wide variety of economic statistics that have an obvious impact on loan performance, they focus instead on the model year of your car and how many people have asked for your credit report. This erroneously ties your fate to the actions of others with whom you may have nothing else in common while ignoring corporate decisons that will affect every customer. The uncertainty principle. True scientists know that while you can sometimes predict the actions of a group, it is impossible to predict the actions of an individual. This principle holds true in social science as well as physics and attempts to violate it are a frequent source of fun in science fiction. The END ************************* LB 59
Re: Re: Re: FICO...does it make any sense ??? CREDIT SCORING 2 of 3 Self fulfilling prophecies. The mere act of predicting financial failure tends to cause that prediction to come true. This most famous of scientific observations was immortalized by Einstein in Schroedingers Cat. Is it my score or my neighborhoods score? Ask your banker what factors most influence your credit score. You will hear the old chestnut about your payment history, your stability over time, your this and your that. A banker that says this is showing his/her ignorance. Few if any bankers or regulators really know what goes on in the computer scoring program. The dirty secret they don't share is that in recent years "your" conduct has meant less and less, and the conduct of people like you has meant more and more. One sign of this is when the banker refuses to request an updated score after you have "cleaned up" your credit. He knows "your" credit history may not even be a signifigant factor in the final score. A process called Market segmentation (outside link-any email address will work here) is what tells lenders about people like you. It started out as a simple tool to target mail ads to those who would be interested in buying a particular product. Over the years business started to use this valuable marketing tool as a type of scum filter, to screen out those whom they would rather not have in their neighborhood for whatever reason. Tools designed for advertising are now frequently misused as a brick wall to keep undesireables (like you perhaps) from entering the marketplace at all--regardless of ability or willingness to pay. Laziness, greed and and a desire to avoid the risks inherant in a free market cause many firms to misuse both credit scoring and marketing data. The Marketplace and Credit Scores A healthy free maket is open to everyone with the means to compete. Class designation (aka market segment) should have no bearing on the right to buy or sell. In a free market there are no penalties for comparing prices or shopping for the best deal. The buyer researches the seller, since the buyer is taking the greater risk. What has evolved in the US (through extraordinary efforts to sell credit data) resembles not so much a free market as a private high school party. Those excluded are never told the real reason they weren't invited. The sellers offer and the buyers acceptance that form the basis of a free market are rapidly disappearing. Even when the seller has nothing at risk potential customers are told to "apply" and are judged by secret criteria that include what side of the tracks they come from, age, and various tests to see how well they fit the sellers stereotype. Credit scoring is the tool that hides this appalling fact from the public. Don't believe it is this bad? Check out what happens to your information when you order checks from Deluxe Check Printers. Does a low score mean I have done something wrong? You have probably heard that scoring systems grade you on the likelyhood the loan will be paid back. This is only partially accurate. Modern decision/scoring systems are designed to find the most profitable customers--not the most reliable. The most profitable customer is not the one who regularly pays off the balance and knows her legal rights. No indeed. Banking profits come from overdraft charges, late payment fees and sky high interest on revolving balances. The profitable customer is deeply in debt and ashamed to challenge overcharges for fear of incurring the wrath of creditors. Scoring systems are designed to find customers who are in this trap and keep milking them, then dump the account just before the victim is forced into bankruptcy. Being an intelligent consumer and managing your money wisely will put your credit score in the dump. Spending so much that you have to borrow to survive will go a long way toward improving your credit score (and destroying your life). If your score is low you are in good company. Often the best credit risks have the lowest scores. Take the hypothetical example of Bill Gate$. Microsoft, and presumably Bill, have no debt. His savings, investments and money owed to him do not count in credit bureau scoring. All the computer knows is that he isn't swimming in debt like everybody else and therefore assume he must be hiding something. Bills credit worthiness is further impaired by marrying later than those in his demographic group and thus he has committed the cardinal sin of acting differantly than expected. To a computer the worlds richest person is obviously a bad credit risk. Sorry Bill. You can't be trusted with a credit card or rental car. If you have experienced this phenomenon, let us know at VCR mail The END ************************* LB 59
Re: Re: Re: FICO...does it make any sense ??? CREDIT SCORING 3 of 3 What SHOULD influence a credit score? We think basing credit scores on the uncontrolled rumor mill known as credit reports or on a consumers shopping habits is hogwash. There are better ways that would give both parties the information needed to decide if they wish to enter into a particular transaction. Report Accuracy - Credit bureaus should be required to provide data on the reporting companies previous accuracy for each "tradeline" (each item on your report). Some national retail chains ruin millions of lives each year through inaacurate reports, yet scoring systems don't take a history of inaccurate reporting into account. Lenders score - Defaults of all kinds are often caused by abusive loan servicing policies. Borrowers have a right to know the default rate for a companies previous customers (particularly forclosures) before they risk dealing with a company who will destroy their credit. Economic Forecasts - The biggest cause of default is a downturn in the local economy - a factor totally ignored by todays scoring systems. No lender should judge you (directly or indirectly) by zip codes, telephone number numerology, last residents or neighbors payment history, racial purchases, model/year of your car, being a victim of violant crime, religion, hair color, left/right handedness or astrological signs even if some zealous sales department claims proof they are predictive. Why aren't these obvious suggestions in use today? Credit bureaus and scoring companies are heavily influenced by what their customers want to hear. As a victim you are not the customer. Financial institutions are the customer. Banks want to hear they can push a button and predict the future. They want to hear that loan defaults happen because of a personality defect in the borrower. They do not want to hear business policies cause defaults. And they certainly don't want to hear that credit report glitches are caused more by business than by the consumer. Credit Scoring by bureaucrats who should know better Background - Scoring systems are, in theory, regulated by several Federal Agencies and laws such as regulation B. Due to a lack of centralization (and too many lobbyists) no single agency has authority over scoring developments. The OCC (Office of Comptroller of the Currency) is doing more than any other agency to monitor scoring, but has been handicapped by Federal Reserve legal interpretations. The "Fed" has taken the unbelievable position that discrimination is legal if done by a computer. (see also Famous Failures.) Freddie Mac is the government chartered banking coalition that handles most low and medium priced home loans in the US. Freddies endorsement of credit scoring caused most financial institutions to believe you could predict future loan performance based on a single secret number derived from sources even the banks have no way of verifying. Default rates skyrocketed as those with extensive histories of past debt were granted home loans while those who saved and avoided debt were turned away as bad credit risks. A program that claimed to open up housing to "marginal buyers" ended up rejecting far more applicants than the previous system. Read the Freddie-Mac credit scoring "fact" sheet and see if you can spot the logic errors that sold the Federal Reserve and Freddie-Mac on the validity of credit bureau scores. (Hints: You can predict yesterdays horse races using any predictor you want - you will always have high accuracy. Look for sampling errors and cause vs effect confusion.) Read the Mosely Report starting at Chapter 1 if you want to be astounded at the assumptions made in order to validate real estate loan credit scoring systems. What they won't tell you is that mortgage default rates skyrocketed shortly after scoring was forced on the mortgage market, despite a booming economy. This fits the historic record of increasing personal bankruptcies as credit reports/scoring replaces good banking practice. The FTC is tapdancing on the issue of scoring with a new series of slightly more realistic brochures on general credit scoring and equal credit opportunity. Both brochures skim over the issue of marketing databases used in scores. The future Get familiar with the phrase "Transactional Data". It is the data gathered about what products you buy when paying by credit/debit card or using an ID card of any kind. Retail outlets are collecting and using this information in ways you would not approve of. discussion groups and trade magazines are hinting that your bank (or paperboy) can already judge your worthiness based on what book titles you buy (King James versus New American) or what hair care products you use (Clairol versus AfroSheen). Many sheltered programmers in the scoring industry don't realize how far this trend has already gone, but it is apparent that what you buy does affect your ability to get credit. Want more? Here is just one firm (Deluxe check printers) that analyzes and sells your checking account information. The desire to predict the future Since the dawn of man there have been those who claim to predict the future. Their predictions find easy targets in those who wish absolute control of others without risk to themselves. Advisors to Caesar killed a pigeon the night before a battle and solemnly studied the twisted pattern of the guts to determine the outcome of the conflict. The Roman empire rose and fell on such superstition. History is full of oppression by prediction. The claimed ability to predict the future is a favorite tool of those who would control the destiny of people without their approval, and even the oldest religious texts warn against it. The right of Kings to rule without the peoples consent (the Divine Right) was based largely on his ability to fortell the future (divination). The predictive power of head measurements (the "science" of phrenology) was once widely accepted. Eugenics mixed biased predictive models with racism and found entire nations willing to accept predictions as it became a favorite of Nazi scientists. Handwriting analysis -- using a computer for a dash of credibility -- still promises advice at circuses all over the world. It doesn't matter what they are called--fortune tellers, diviners, or soothsayers--they all claim to have some secret tool to read the signs and omens. Fortune tellers base their predictions on what they consider likely in their own little world, and this inevitably leads to bias. Indeed, most superstition and prejudice in todays world stems from yesterdays accepted methods of predicting the future. Secrecy and mysticism are hallmarks of the crystal ball crowd, and it is that secrecy that divides the soothsayer from the scientist. A diviner justifies his predictions by saying he forsaw events that have already happened ("The signs were there. I could have warned you...."). In the real world this magic doesn't work and so he hides behind layers and layers of secrecy, spreading the word that his power is just too complex to be understood by anyone else. A scientist submits his theories for publication and peer review, controls the experiment and data for bias, and tests his accuracy by using prediction tools that were designed before the predicted event took place. From The Vaults The following item appeared on our pages back in '95. We are doing a followup: Federal Reserve Governor Can't Get "Toy's R Us" Credit Card Original news story A salary of $123,000 and a seat on the Board of the Federal Reserve wasn't enough to convince computers at the Bank of New York to grant Lawrence B. Lindsey a Visa Card. Published reports indicate the credit scoring program rejected the application because the applicant had 8 reports issued in the last year. Both Toys R Us and Bank of New York issued statements regretting the incident and offering Mr. Lindsey a card. No mention was made in either statement of the millions of ordinary citizens who are victimized the same way each year. Mr. Lindsey has been a vocal critic of credit scoring systems for some time. The Associated Press quotes him as saying "If human beings are taken out of the loop, some rationality and common sense is lost in the process." The END ************************* LB 59
Re: Re: Re: FICO...does it make any sense ??? Well, whoever wrote that certainly has issues. Where did you find it?
Re: Re: Re: FICO...does it make any sense ??? Just keep in mind that your FICO is given to you by an independent company. It is the same as your local grocery store or Starbucks telling you where you stand. It is not a governmental assessment, it is not an official conclusion, it is not a real number. If you were to pay cash for all your purchases, this score would mean nothing. FICO is nothing more than America Online assessing your credit rating. Although companies use it as a lending tool, you will be far better off believing that it is nothing more than fiction. I realize that it is in fact important, based solely on the fact that lenders assess your worth on your credit reports, but also remember that these companies are no different than that kid who squealed on you in the 3rd grade for turning in your homework late.
Re: Re: Re: Re: FICO...does it make any sense ??? Well said chipper... but there is too many folks these days who depends on what FICO says...unfortunately...
Re: Re: Re: Re: FICO...does it make any sense ??? The original 3-part post was taken verbatim from a web sity called "chexsystemssux" or "victimsofchexsystems" or something like taht. The site is one showing the effects of Chex Systems and it got intoi Credit Scoring. That site has been up for about 5 years or more and hasn't been updated in at least 3 years. By doing a search under "chex systems" and "victims" you can probably find it.
Re: Re: Re: Re: FICO...does it make any sense ??? The reason credit scoring does not work is rather simple. Just imagine standing at the stern of a boat and watching the wake as the boat is moving forward. The wake only tells you where the boat has been , but it has no actual bearing on the future direction of the boat.
Re: Re: Re: Re: Re: FICO...does it make any sense ??? The wake only tells you where the boat has been creditdog ================ A lot of people are getting financially drowned in the wake of fico. The END ************************* LB 59
I have something of a background in statistics & modeling, and while I hate the credit scoring models as much as the rest of you, I have to say that they do work for their intended users. The problem is, you and I-the consumer-are not the intended user. On an individual basis, our scores are meaningless. The intended users are banks and institutions that sell thousands and millions of loans. On a business level, they don't care about my score of 600, they just know that they need, say 40% of their loans to be to people at or above 600. By segregating their loans, with certain percentages at one level, and certain percentage at another level, they add predictability into their FUTURE PROFITS. Of course it's a very inprecise tool, but it's only intended to tell them how profitable large groups of debtors will be. We, as individuals, just fall into one group or another, but together with all the other people in that group, we are pretty predicable in terms of what percentage will defalt, etc... I can't look at that group and pick out an individual who will default, but I can say that I'll probably see a certain level of profitability from that group. We are rejected for credit as individuals, not just on our score, but on a quota system. Banks certainly have quotas... they can take another 50 people at 600 today, and if you aren't in the first 50, you're out of luck. They are always trying to balance their groups of scores to give them the "right" mixture of profit to risk. It really screws me as an individual, but what we can we do? One more thing, and this will piss us all off. (Bad reporting aside), most of the people on this board ARE BAD CREDIT RISKS... After all, many have legitimate collections, missed payments, high balances. Ask yourself this question, "would you loan money to a complete stranger who'd filed bk before and was late on three of his credit cards?"
Re: Re: FICO...does it make any sense ??? So that is why I was DENIED PROVIDIAN a few years ago with NO "BADDIES" EVER and a F.I.C.O. of 739 and income of $XXX,XXX~~LIKE A JOB~~I'M OVER QUALIFIED??? At the same time people with LOW 600's were getting the cards...like crazy...
