New way to score credit still flawed
Not a lot of love for the credit bureaus' new Vantage score...
By now you might have heard that the three major credit bureaus have introduced a new scoring system they hope will someday replace the current FICO credit score.
Equifax, Experian and TransUnion recently unveiled what they are calling the 'VantageScore,' a system that will reportedly simplify credit-risk scoring that helps determine what interest rate consumers will pay.
Eventually, the companies would like credit grantors -- banks, credit card companies, auto dealers, mortgage lenders -- to stop using FICO scores, which are calculated using software developed by Fair Isaac Corp. FICO is the most widely used scoring model.
The three bureaus hold the financial histories of millions of people. The information in the files is used to create a score from a low of 300 to a high of 850 in the case of the FICO system.
The credit bureaus say they've introduced this new system so that the scores being reported to credit grantors are consistent and easier to interpret. To understand what that means, you need to know that while we all get a score generated from each bureau, how those scores are determined can vary greatly.
Full article on ContraCostaTimes.com
By now you might have heard that the three major credit bureaus have introduced a new scoring system they hope will someday replace the current FICO credit score.
Equifax, Experian and TransUnion recently unveiled what they are calling the 'VantageScore,' a system that will reportedly simplify credit-risk scoring that helps determine what interest rate consumers will pay.
Eventually, the companies would like credit grantors -- banks, credit card companies, auto dealers, mortgage lenders -- to stop using FICO scores, which are calculated using software developed by Fair Isaac Corp. FICO is the most widely used scoring model.
The three bureaus hold the financial histories of millions of people. The information in the files is used to create a score from a low of 300 to a high of 850 in the case of the FICO system.
The credit bureaus say they've introduced this new system so that the scores being reported to credit grantors are consistent and easier to interpret. To understand what that means, you need to know that while we all get a score generated from each bureau, how those scores are determined can vary greatly.
Full article on ContraCostaTimes.com
posted by Dave at 12:14 PM
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