Credit score urban myth by the numbers

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The Young Turks

“Should Employers Check Credit Scores?”: 13,142 in 4 days

“The Young Turks” host said, “So, who gives a damn what their credit score is?”

The consumer reporting agencies all state that they do not provide credit scores for employment purposes.

[email to The Young Turks]

CNBC draws USA TODAY into the fray

A story on CNBC’s website stated:

But how possible is it really to achieve an 850, and is it worth the effort? says that only .5 – 1 percent of consumers have achieved this golden number. asked CNBC for the name a person who, or the address of a document that, is the source of that statistic.  Rather than naming its source, CNBC replied that a myFICO representative said that 13 percent have a score over 800.  CNBC changed its story so that it said this:

But how possible is it really to achieve a perfect score, and is it worth the effort? reports that only 13% percent[SIC] of consumers have achieved scores over 800.

USA TODAY republished the CNBC article.

However, in July, USA TODAY published an Associated Press report that said:

On the positive side, the number of consumers who have a top score of 800 or above has increased in recent years. At least in part, this reflects that more individuals have cut spending and paid down debt in response to the recession. Their ranks now stand at 17.9%, which is notably above the historical average of 13%, though down from 18.7% in April 2008 before the market meltdown.

In July, Fair Isaac said that it would replace its distribution chart.  It has not done so.

FICO score service on TransUnion website to end

The availability of FICO scores on TransUnion’s website will end by March 31, 2011, according to TransUnion’s Steve Katz.

Consumers will still have access to FICO scores based on TransUnion files at after the end of the TransUnion Consumer Solutions service.

Equifax FICOs are available from myFICO or  Consumers’ access to Experian FICO scores ended in 2009.

What is THE average credit score?

Last month, in what seemed like a big scoop over its rival news agencies, the Associated Press reported that, now, 25.5% of Americans have FICO scores below 600.  But, the score model in that report is a new score, FICO 8 (BEACON 09), which is not sanctioned by the two big housing finance agencies, nor even the one sold to consumers by the main scoring company.  The story stuck.  Following questioning by, FICO (the company) removed FICO (the score) distribution charts from its website.

This month, rival news agency Reuters struck back.  On Friday, in her story “Scorning debt, consumers’ credit scores soar,” Helen Chernikoff wrote, “The average credit score rose to 704 in July, a level not seen since the first quarter of 1998, according to data that Equifax Inc (EFX.N), one of the largest U.S. credit bureaus, provided exclusively to Reuters.”

To what score model she refers is unclear.  In the article, 850 is the highest score on the scale, but there is no mention of the lowest.  So, to the average person, the model might look like the broad-based risk FICO credit bureau score BEACON 5.0 available to consumers at myFICO and required by Fannie Mae and Freddie Mac.

Or, it could be something else.

That is because the consumer reporting agencies play a childish game with numbers, creating credit scores with scales similar to that of the well-known FICO score, 300-850.  TransUnion even makes one, called Transrisk, that has exactly the same scale as the FICO–300 to 850.  There’s PLUS at Experian (330-830).  And, in the case of the company that is subject of the fabulous exclusive Reuters story, there is the Equifax Risk Score 3.0 (280-850).

Illinois governor: Employers use credit score

The national consumer reporting agencies all state that they do not provide credit scores for employment purposes.

In spite of that, as Governor Pat Quinn of Illinois signed a bill into law, he used the word “score” twice.  State Senator Don Harmon piled on.



Quinn (2:23):  “… will not allow employers to use credit score to decide whether or not somebody is going to get a job or somebody is going to get a promotion.”

Harmon (3:25) :  This bill strikes an appropriate balance.  It says, as a general principle, employers can’t use your credit history, your credit score, in determining whether or not to hire your or promote you.

Quinn (4:21):  “Unfortunately, some employers are using credit score of an individual person to decide whether someone gets hired, or someone gets retained on a job, or someone gets a promotion on that job.”

The new law, however, allows credit history use in the case of an “established bona fide occupational requirement.” 

The Chicago Tribune reported, “[Rep. Jack] Franks said a lobbyist working for TransUnion ‘duped him’ into replacing references to ‘credit history’ with ‘credit scores,’ which are not used in hiring.”

An official of Consumer reporting agency TransUnion testified in Oregon, “There’s no such thing as a credit score in employment.”  TransUnion is based in Chicago. 

At least, somebody is contolling the message in this messy state’s heady merry go round.  The governor’s press release does not include the word “score.”  But give him a break.  He didn’t run for the job.

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

Wikipedia Credit Karma/FICO baloney

The 4-year mess continues.  But, how long will it take the collective brain of the world to figure out this one?

Genius contributes:  “Credit Karma will provide the FICO score from TransUnion for free, but will not provide the actual credit report.”

But, as any idiot can see, at the “wiki” about Credit Karma:

Credit Karma provides users with a proprietary credit score model. The scoring is on a scale of 300 to 850 which is the same scale as FICO Score from Fair Issac Corporation.

And, what a coincidence!  The Credit Karma score scale is exactly the same as the FICO!  No wonder the wiki is whack. 

The editors were duped again by just another Fake-O flim flam.