Category: FICO

FHA average FICO score surpasses 700

FHA (the Federal Housing Administration) reports, “For the first time the average FICO score for insured cases reached the 700 level — actually 702.”

But, somebody thinks that’s not necessarily such a great thing.  The U.S. Department of Housing and Urban Development (HUD (FHA is part of HUD)) has just opened investigations resulting from complaints filed by the National Community Reinvestment Coalition (NCRC).  NCRC states that its investigation “reveals that too many of the country’s largest financial institutions are refusing to lend under the FHA loan program to consumers with credit scores between 580 and 640, despite the fact that FHA policy establishes a 100% guarantee for refinance.”

However, lenders are judged by their default and claim rates, and their underwriting authority can be termintated if those rates are too high.

Also, see:  Average credit score chart, FHA loans.

National Association of Realtors – NAR credit policy

The NATIONAL ASSOCIATION OF REALTORS actually has a written credit policy; it is named “NAR Credit Policy.”

The sub-title is, “LENDERS, FHA, THE GSEs, AND FEDERAL REGULATORS SHOULD REASSESS AND AMEND THEIR CREDIT POLICIES SO MORE QUALIFIED BORROWERS ARE APPROVED FOR MORTGAGES”

The policy states:  “NAR questions the assumption that borrowers who agree to a loan modification or a payment plan for credit obligations they can no longer afford but who then demonstrate their ability to handle the modified payments are higher credit risks. NAR urges FICO to study the credit risk performance of these consumers and modify the FICO formula accordingly.”
 

Average FICO credit score missing

Just when Wikipedia gets its act together, the average FICO credit score goes missing.

In the first story of Two and Two (a new section on creditscoring.com), questions are posed to FICO.  The median, the mean, the CEO, and an absent Experian all play their parts.

Things just don’t add up.  How is America supposed to know where it stands?  Is the average going up, or down?  What’s the big secret?

Legislation uses FICO, not Fake-O, score as benchmark

H. R. 600, the FHA Seller-Financed Downpayment Reform Act of 2009, introduced by “Mr. AL GREEN of Texas (for himself, Ms. WATERS, and Mr. GARY G. MILLER of California)” uses the term “FICO score” 5 times.  It is a bill “To revise the requirements for seller-financed downpayments for mortgages for single-family housing insured by the Secretary of Housing and Urban Development under title II of the National Housing Act.”  

In March, 2010, Representative Green said, “Thank you very much, and thank for that new term for my vocabulary: Fake-O.” (2:13:58 in the video)

Cub reporters document employers saying they use credit scores

Recently, a Reuters blogger said that the CEO of credit score company FICO told him that employers use credit scores.

But despite FICO’s claim and the rest of the hoopla, only two employers have admitted it.

A Virginia television station obtained video footage of a credit union representative saying “Being a financial institution we have a set level its yes or no. If the credit score is below a certain number, then there’s nothing we can do about it.”

Virginia

In Texas, a television reporter interviews a bank senior vice president who said, “If someone is going to be handling your money and their credit score reflects irresponsibility with money— with their own money– then there may be some concern that they might be irresponsible with your funds, too.”

Equifax: We’re the only one

From: Greg Fisher
Sent: Monday, February 22, 2010 12:16 AM
To: Tim Klein, vice president, public relations, Equifax
Subject: credit score, FICO, Equifax, exclusivity

Richard F. Smith, chairman and chief executive officer
Equifax, Inc.

You write, “The FICO Score is the most commonly used scoring model among lenders, and Equifax is the only major credit reporting agency that can provide you with your FICO Score.”

Is Equifax really the only one, or are you saying that TransUnion is not a major consumer reporting agency?

Also, please address the question from October 14 regarding the Dallas Morning News.

Greg Fisher
The Credit Scoring Site
PO Box 342
Dayton, Ohio   45409-0342
937-681-3224

Reuters blogger: FICO says employers use credit scores

Fun feedback loop

Selling its score, FICO cheerfully says that employers use credit scores (occurs at :47 in the video).

Consumer reporting agencies claim that they do not sell credit scores to employers.

Ben Stein says that employers use credit scores.

Felix writes about Ben Stein.

creditscoring.com writes about Felix writing about Ben Stein.

creditscoring.com blog comments trackback to Felix’s blog (July 28 comment: “simmers“).

Felix writes that FICO told him that employers use credit scores.

creditscoring.com writes about Felix writing about FICO telling Felix that employers using credit scores (this page).