Media | The Credit Score Blog

credit score, utilization ratio, Wikipedia reference to USA TODAY, unverified

SEE ORIGINAL EMAIL TO USA TODAY

From: Block, Sandra
Sent: Friday, February 04, 2011 11:47 AM
To: ‘greg@creditscoring.com’
Subject: RE: credit score, utilization ratio, Wikipedia reference to USA TODAY

http://www.myfico.com/CreditEducation/WhatsInYourScore.aspx

Sandra Block
Personal Finance Reporter
USA TODAY
You can find my stories and columns at: http://www.usatoday.com/community/tags/reporter.aspx?id=561
Follow me at:
http://twitter.com/sandyblock

From: Greg Fisher [mailto:greg@creditscoring.com]
Sent: Friday, February 04, 2011 12:51 PM
To: Sandra Block, reporter, personal finance, USA TODAY
Subject: RE: credit score, utilization ratio, Wikipedia reference to USA TODAY, unverified

SEE https://blog.creditscoring.com/?tag=usa-today-ratio.

That document does not verify your statement. In it, 30% is a number assigned to an entire category called “Amounts Owed.” 6 items comprise the category. For instance, one is “Number of Accounts with Balances,” and has nothing to do with the ratio of debt to available credit. “Proportion of credit lines used (proportion of balances to total credit limits on certain types of revolving accounts)” is only one item in the category and is listed fifth.

What correction will you make?

credit score, utilization ratio, Wikipedia reference to USA TODAY

From: Greg Fisher [mailto:greg@creditscoring.com]
Sent: Friday, February 04, 2011 11:25 AM
To: Sandra Block, reporter, personal finance, USA TODAY
Subject: credit score, utilization ratio, Wikipedia reference to USA TODAY

THIS MESSAGE IS PUBLISHED AT https://blog.creditscoring.com/?p=1727.

You wrote, “The amount of debt you have outstanding, as a percentage of your available credit limit, accounts for 30% of your score.”

However, Fair Isaac explains that, to avoid misleading the public, it does not make such a claim.

Wikipedia uses your story containing that sentence as a reference regarding “30% — Credit utilization.”

Who is your source?

—
Greg Fisher
The Credit Scoring Site
creditscoring.com
PO Box 342
Dayton, Ohio 45409-0342

Fun with Numbers: Washington Times on FICO score range

In a cover story, the Washington Times states, “While debt-to-income ratios and the availability of funds for a down payment and closing costs also have an impact on a loan decision, lenders use an automated underwriting system that depends heavily on consumer credit scores, which range from 350 to 850.”

Later in the article, the Times reports again: “According to www.fico.com, the FICO 8 Mortgage Score provides lenders with a better prediction of the possibility of a mortgage default. Scores are in the same range (350 to 850) as traditional FICO scores, but the score is weighted more heavily by payments that are 90 days late or longer and mortgage and/or rental payment performance.”

FICO score company Fair Isaac claims that the scale starts at 300.

credit score, employers, undersecretary, Office of Consumer Affairs and Business Regulation, Commonwealth of Massachusetts

From: Greg Fisher [mailto:greg@creditscoring.com]
Sent: Tuesday, January 25, 2011 11:12 AM
To: Barbara Anthony, undersecretary, Office of Consumer Affairs and Business Regulation, Commonwealth of Massachusetts
Cc: Jason Lefferts, director of communications, Office of Consumer Affairs and Business Regulation, Commonwealth of Massachusetts
Subject: credit score, employers, undersecretary, Office of Consumer Affairs and Business Regulation, Commonwealth of Massachusetts

You wrote: “A credit score is a vital tool that goes beyond whether or not a bank or retailer will hand you a credit card. It affects your interest rate when applying for a mortgage or getting a car loan, and in some cases can be checked by a prospective employer.”

What indicates that employers use credit scores?

Rumor thread 1 – Rupert Murdoch does not know how to use the internet

Wading through the muck, yesterday we learned that pressreleasemag.com published–

“Unfortunately, for people who are unemployed, this can easily become a catch-22: If their credit score dips because of the financial straits caused by unemployment, they may have increasing trouble finding a new job, because their credit score is low.”

— which are exactly the same words that CreditCardGuide.com published.

The CreditCardGuide.com author said that one of her sources is–

http://www.moolanomy.com/3770/why-a-good-credit-rating-is-important-even-if-you-dont-use-credit-mmarquit01/ .

The Moolanomy author said that one of her sources is–

http://blogs.wsj.com/wallet/2009/03/11/one-in-six-employers-looking-at-your-credit-report-study-finds/ .

The Wall Street Journal item, because of its original claim and whose page contains a comment questioning the story’s accuracy (Lester Rosen, an expert who calls it an urban myth also commented), still states that employers use credit scores in its source code. It says, “<meta content=”Many employers are checking job candidates’ credit scores, but how big of a factor are credit scores in a company’s eventual decision to hire?” />” (in Internet Explorer 8, on the menu bar, click on View, then Source (or use Alt+V, C) to see it; in Firefox, click on View, then Page Source (or use Ctrl+U)).

So, for instance, in Yahoo!, if you search for the term credit scores employers, the results page shows this for the Wall Street Journal page:

One in Six Employers Look at Your Credit Report – The Wallet …
Many employers are checking job candidates’ credit scores, but how big of a factor are credit scores in a company’s eventual decision to hire?
blogs.wsj.com/wallet/2009/03/11/one-in-six-employers… – Cached

Despite even the comment right on his page, Rupert Murdoch has still not made a correction to that meta description tag. He does not know how to use the internet.

So, Moolanomy is a source for Bankrate. Martin Halusa has not made an “update.”

Trail of a rumor: Credit scores, employers and media

Consumer reporting agencies TransUnion, Equifax and Experian all state that they do not provide credit scores for employment purposes. Author and SmartCredit.com writer John Ulzheimer calls the notion that employers use credit scores the myth of the decade. Lester Rosen, president of Employment Screening Resources (ESR) and a qualified employment screening expert calls it an urban myth.

Here’s how the rumor spreads. This is seedy, so wear your boots.

Today, the headline “Government and Private Employers Check Credit Scores” appears on a popular news search website. The headline comes from pressreleasemag.com, a domain created only two months ago. ‎The January 12 story begins with this paragraph: “More and more employers especially in the government sector… finding a new job, because their credit score is low.”

Those are the same, exact 93 words, found on CreditCardGuide.com in a story dated January 9.

CreditCardguide.com has not responded.

The following is unrelated to employers and credit scores, but is too intriguing to pass up. The pressreleasemag.com story continues in the second paragraph: “On account that credit is a nebulous number… free annual credit reports I could keep up.”

So, there are 92 more words that are exactly the same as another press release on another website.

Next paragraph: “However, cards with a flexible spending limit, while convenient, can present… preferably under 30 percent and ideally at 10 percent to 20 percent.”

That’s a new twist. 85 of the words in that paragraph are exactly the same as an 87-word paragraph in a December 27 story on CreditCardGuide.com. But whoever is doing the deed at pressreleasemag.com changed the last two words. They actually did some real work— such as it is.

Next paragraph: “That rankles a lot of people, but what really annoys … will use when you apply for a loan.”

Ouch. The big Kahuna. Gannett’s USA TODAY was the victim this time; 81 words.

Finally: “The Equifax website has a lot of information about not only free, but discounted… prices vary but all are less than the $10.50 the bureau normally charges for a single report.)”

75 words. Victim: AOL.

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? MyFICO.com says that only .5 – 1 percent of consumers have achieved this golden number.

creditscoring.com 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? MyFICO.com 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.

The enigmatic realm of credit scores at CNBC

Following a question from creditscoring.com regarding a CNBC claim that “only .5 – 1 percent of consumers” have achieved an 850 credit score, CNBC amended a January 4th story on its website. The error and its correction is not documented.

The original statement was, “MyFICO.com says that only .5 – 1 percent of consumers have achieved this golden number.

The corrected statement is, “MyFICO.com reports that only 13% percent[SIC] of consumers have achieved scores over 800.”

However, in July, (after questions from creditscoring.com about an Associated Press report) Fair Isaac, the company who owns myFICO, removed the distribution chart that included the 13 percent statistic, and said that it would replace it. The credit score company, still, has not provided the replacement.

Despite that, in October, the U.S. Equal Employment Opportunity Commission heard remarks from the National Consumer Law Center regarding a conclusion cobbled together about the credit score national distribution. The NCLC’s notion that one-quarter of consumers have a credit score under 600 was attributed to Fair Isaac, and the notion that those under 600 comprised only 15 percent before “the Great Recession” was attributed to the Associated Press.

A FICO spokesman said that the AP used the 15 percent statistic “as a proxy for a pre-recession distribution curve.”

On April 13, introducing a segment titled “Credit Check: Career Killer?,” a CNBC anchor asked, “Does a credit score– especially a high one– indicate a better applicant?”

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

Credit scores in old and new media

A CBS News correspondent said:

“(Your credit score) is what almost every company in your life uses to determine whether you are a credible, trustworthy borrowing candidate. From your prospective employers to your prospective landlords, most companies will check your credit score in order to gauge their risk. No one likes a deadbeat!”

An anonymous writer for Investopedia had the (exact) same thought:

“Well, it’s what almost every company in your life uses to determine whether you are a credible, trustworthy borrowing candidate. From your prospective employers to your prospective landlords, most companies will check your credit score in order to gauge their risk. No one likes a deadbeat!” [update, 4/24/2011]

But, even funnier, is that the chain goes one more step: The anonymous writer thinks a lot like another writer.

The Counter-Plagiarism Handbook : CJR
Copy, Shake, and Paste
University of Chicago Plagiarism Guidelines

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Update 12/23/2010: Part Two