why do we have to PAY for this info?

why do we have to pay for this information...shouldn't it belong to us?

The credit scoring industry leaves a lot to be desired. It does not take into consideration any savings, investements or other income other than employment--they have no clue as to what a person is really worth. Just looking at their debt is a false look into anyones credit worthiness and I would agree that the credit scoring industries are probably just as much at fault for the credit messes as the sub-prime lenders in this situation. I for one, don't work, but have sufficient savings and investments--therefore their credit score is totally incorrect. Having worked in an industry for years that uses some of the differen credit scoring companies--know first hand that it's all about the money they can make from providing the credit reports and the 'score'. It's a joke--and nothing more then a money making opportunity for the credit bureaus themselves.

My husband and I got hit by Sprint also. The only reason we have a cell phone is to use in an emergency. We don't make photos, text, download, or anything else. We have never used even half of our minutes.

We got a bill for our regular monthly usage and an extra $75.00 for downloading a file. We called and told them that we did not download a file. The person we talked to was so insulting and practically called us a liar. So we went to the Sprint store where we purchased the phone. I am retired and I thought that if they saw us in person we would be more believable. The clerk there was a little more sympathetic and said they would remove the $75.00 charge.

The next month we got hit with the $75.00 charge again. Plus they added the previous $75.00 charge back in again. So now we owe $150.00 in addition to our regular charges.

We continued paying the bills (less the $75.00 charges) each month. They finally threated to turn us in to a collection agency so my husband paid the bill in full.

We went back to the Sprint store and asked them to check the phone to see if something was wrong with it. They did and told us we were downloading a file every month but they couldn't tell us what it was. We told them not only did we not download a file...we don't even know how.

Well to make a long story short, we finally had Sprint disable our cell phone. We told them we would continue to make the monthly payment since we only had three more months on our contract and it was cheaper than paying the cancellation fee.

Then we totally disabled the actual cell phone. (I wanted to destroy it with a sledge hammer but my husband would not let me).

The next month we got our bill and sure enough the 75.00 charge for downloading a file was included. We called Sprint and said "now will you believe us"? Our cell phone is no longer in service...so how could we download a file? They had to agree.

Eventually all of those $75.00 charges were removed from our bill but Sprint did not have to pay for the mental anguish we suffered over those 6 months and no one ever appologized for the insulting nature of those employees we had to deal with.

I despise Sprint.

Pah... I've been paying my bills on time, have a nice cushion between owed and available on my credit cards, and the limits are low... yet I have a 542 while my husband who has MORE credit and therefore owes much much more, has a 724. The difference? He has 2 years more of credit history that I. Fair? Far far from it.

You have to be vigilant, I was suprised last fall when I was turned down for a credit card. In following up, I noted that a judgement was listed against me on one of my credit reports, involving a car accident that had been resolve my insurance company, Allstate. Allstate provided me the documents proving that both attornys had signed off on the settlement back in 2005. I had to forward this info to TransUnion. It was clear to me that someone, simply data mined the information at the courthouse and reported incomplete and inaccurate info.

I think you should have mentioned the Fair Credit Reporting Act (FCRA). The governments website for your FREE credit report is www.annualcreditreport.com. Also they should check out www.ftc.gov/bcp/conline/pubs/credit/freereports.shtm for all the information regarding Fair Credit Reporting Act (FCRA). Thanks.

Personally what happened to the good old days, you approved or disapproved loans on a persons/couples character.

I think you need to check your 'facts'. There absolutely is a part of the scoring calculation for your income vs. debt ratio. Income is taken into consideration. You state that consumers do not have access to their actual FICO score. I recently ordered my credit reports and scores from all three major credit bureaus. Experian, you are correct, uses what it calls Vantage Score. Trans Union simply calls it Personal Credit Score. Equifax, however,provides the actual FICO score. As you indicate in your column, these are extremely important consumer matters. Many consumers are only recently learning how to properly manage their credit. As such, you should be sure to check all of your facts before publishing this information. Beleive it or not, many readers will take you for your word assuming you are some sort of credit expert and you are doing them a huge disservice by continuing to publish erroneous information as if it was true.

900+ here on all 3 scores. Like they say...work hard, pay your bills, and don't max out your credit card. You'll be golden if you do that. I know it can be tough (especially since I've had cancer), but it can be done. You don't always have to have the latest and greatest stuff, just be happy with what you have and save some $ every once in a while!

Credit only enriches the rich. its a fine tool that is abused and misused by nearly everyone. when people buy groceries and sundries with a credit card gasoline cigarettes you name it we do not need another government
regularization but people are their own enemies.

Its about time they clean it up. Every loan I have applied for, I always "do my homework" and clean up my credit report beforehand to get in the 720-750 range, and the somehow the lending institution usually "pulls" a 674... with informaiton I've never seen, or things I have already (paid to) have removed. I remember thinking "Its Not -FAIR-" :)

credit scores take away the human element ie, when a single man was given a low score due to a two months past due credit bureau record, the credit score does not ask why. his prior credit was great but was close to his death, hopitized for almost two months with no one to care for his finacial obligations. he later payed everything current and continued so but was being turned down on new credit until a human informed him how to clear that bad report.

I have been trying to refinance my home and have been having a terrible time because my credit report shows a bankrupcy from my ex wife which she got her self into after our devorce. I have spent many hours trying to get this off my credit report and am getting no where. What can a person do get this removed?

You have several other problems with credit reporting agencies. Some of these are that they list inaccurate information. They do not make themselves responsible to check the accuracy of the information that they report. Because a company files information that a person owes them money can be very far from the truth, and misleading. I have had increasingly poor service from companies in an attempt to clear misleading or erroneus information. Several appearances on my credit report have actually been paid three times over in an attempt to clear them. Other companies refuse to clear information when it is brought up to them to be out of date. Employees of these companies have a lackidazical attitude in regard to doing the right thing here.

Additionally, I know millionares whose credit rating in in the trash, while their corporations S&P rating is outstanding.

It is from my experience and experiences of my friends and aquaintances with leads me to believe that credit ratings are meaningless and unethical.

There needs to be some regulated committee to oversee these agencies to make sure they live up to some form of standards, and have consequences for them when they don't.

i could careless what my credit score is, if i cant pay cash for what i need, i just save up for it, [ car's house etc]

Why don't banks create some type of incentive-based or rewards program similar to credit card companies when offering home mortgages? Banks and consumers both benefit when a payment is made on time. The bank can turn around and circulate that cash into another loan, and the borrower can keep their home. For example, maybe banks can lower payments (or rates) to homeowners as a reward for twelve on-time consecutive payments. In this excessive foreclosure time period that we find ourselves in, there must be a win-win solution for both banks and borrowers. It's now obvious to the nation that FICO scores are not an accurate means of determining the ability of a borrower to repay a loan.

"...because if everyone knew the exact steps to get a good score, all consumers would do those things, and the scores would become meaningless."

Huh??!!

If everyone did what was necessary to get a good score, then everyone would pay their bills on time and would avoid maxing out their credit cards. Wouldn't this be a great thing for the economy?

Oh, wait. I forgot that the credit companies reap huge revenues from late payment fees and interest on maxed out cards. No wonder they don't want consumers knowing how to improve their scores.

The credit score does not always say who you are. Most family's have debt, the bills get paid on time. However with the banks using the credit scores and not reviewing the entire financial picture, it not always fair.

I have maintained a household and raised 3 children myself the whole time suffering from Crohns disease, and was limited on a job because of being hard of hearing. Around the time I retired I perforated from my crohns , lost my Dad , everything happened at once and I couldnt keep up the payments on my mobile Home, so I went and got legal help to get out from under that ( I was living by myself by then), I couldnt keep up with my bills as I couldnt get work through the agency I was working with as they were not getting the job orders, it was a mess, I must have paid Kaufmans and Pennys 10 times what I owed them and I did get a couple of bills payed off , and my income decreased as I was on Social Security. Then all of a sudden I couldnt find a place to live or a job ( thanks to the credit bureau) and there were a few things on there that I didnt owe , I just got some print outs of cancelled checks proving I paid the bills and disputed the so called debt but they turned it down, so at 68 years old I have had to sleep in my car and so on and ended up in the hospital because of stress, which Medicare turned down the bills causing me more stress as I donate my medicare payments that are taken from my SS every month, I called Medicare and they said it happens and to have the bills resubmitted and I am still in the process of tracking down all of them and I am terrified of them ending up in the credit bureau. As I have had no permanent address I couldnt get my credit reports and I cant afford to pay for my scores, which the whole thing is unconstitutional, this has been a nightmare. There is much risk of Identify theft when you have to submit SS number to a landlord or with a job application which is handled by how many different people and they really dont need a SS number unless they are going to give you a paycheck, SS numbers are only meant for SS or tax purposes and need to go back to the origin.

FICO is suing the credit bureaus?
Millionaires can't get a credit card?
What do you think about Dave Ramsey's comments that the credit score is really an "I Love Debt" score that just tells you how well you handle debt? Why does my debt carry more weight than my income or savings? Is that a realistic whole picture? Dave's comments are at daveramsey.com/elphub under real estate - mortgage information

I STOPPED USING CREDIT FINDING OUT THAT I WAS PUNISHED FOR PAYING MY BILLS ON TIME. YES, I WONT BUY A CAR, HOUSE OR PLAY THIS STUPID GAME ANYMORE. GROW UP PEOPLE.

There are several misstatement or errors in your article. First, the idea that credit scores were not around before 1988. Prior to automated credit scores, lenders used a manual scoring system for most loans, i.e., car loans, etc. Also, there were several other companies, besides Fair Isaac that built scoring models, among them a company called MDS. Secondly, each credit bureau has their own staff of highly capable statisticians who create scores based on the way that particular bureau receives, interprets and displays information from credit grantors. This does not mean that these scores are not reliable, in fact, many would argue that these scoring formulas are more predictive than the FICO Score because each bureau is more capable of using their own information most accurately as they build their scoring formulas (models). Thirdly, there are countless generic, industry specific and user specific scores being used every day. Additionally, the type of delinquency that is predicted varies -- there are scores that predict 60 - 90 day delinquencies, bankruptcies, charge-offs, etc. The more specific a score is, the more accurate it is. For example, a credit score used for decisions concerning auto loans will be more predictive if it was built using data from consumers who have auto loans. Same thing with bank credit cards, mortages, insurance, etc. The criteria that might predict "good" or "bad" paymnet behavior on a car loan might be different than what is predictive for a credit card. Along the same lines, credit scores created for use by a specific lender and based on the payment behavior of that lender's customers, called Custom Scores, are much more accurate than the generic FICO score. Fair ISaac, as well as all three credit bureaus, build custom scoring models for lenders, for many uses. FInally, the scores that consumers receive from credit bureaus are proprietary scores built by those bureaus using the data provided to that bureau. It is not a question of the accuracy of the scoring model/formula itself, but an issue of how the bureau handles data and updates their files that causes the discrepancies in scores from bureau to bureau.

I work in credit/collections and I have, from day one, thought that credit scores were the most negative thing I have ever seen. I have seen hundreds of credit reports where a consumer has collection accounts and has a better FICO score than someone who has NO collection accounts, NO lates, yet has their credit cards close to their max. I feel that the person who makes sure they get their bills paid on time, and pays any accounts before they get turned over to a collection agency, is a much better risk than someone who just doesnt care. It makes no sense to me and never will. Lenders have told me they don't think they are quite fair either, but have no choice but to use them. Its a game and someone is winning; but not the right guy!

I fully, fully support Fair Issac's suing the three credit bureaus. I'm 64 and I have never seen the unfair, ridiculous use of "credit scores" as a basis for whether you can get a loan for a house or a car OR a lawn mower, than I have in the last few years. Do I blame these credit bureaus for the mess we are in? YES. When a millionaire can't get a loan, but a college student with a $200,000 debt can, there is something wrong with that system.

Credit Scores were not as predictive of future repayment as everyone thought. Billions are being lost because the Scoring Models were flawed. That's the real reason why these companies are "re-configuring/calibrating" the score models. Statistic...80% of all credit reports contain some type of error in them. If the score is derrived from a data base that has that high an error rate, how accurate can the resulting score be ? I have been a lender for 26 years and have a portfolio in the hundreds of millions and I only have 1 Mortgage secured loan going bad right now. Right in the midst of the worst Banking crisis in recent memory the sub-prime mess did not hit us at all...You know how?
No Scoring ! We actually verified the application information and made sure our clients could afford the homes they wanted to purchase or take loans against. Our clients are not facing foreclosure and we do not have mounting losses. Bankers it's easy...if you make a loan decision in ten seconds flat and do little work before granting an approval,how good a decision do you think that is ? Would you take 500,000 of your own money and give it to someone after considering the loan request for ten seconds ? I think the it is self explanatory...
Of course Credit Scoring Companies will say that statistics don't lie and they have records to back them up. I say good, howabout you paying off some of the bad loans made with you scoring models ? You know the loans going bad that had high Scores and good credit? Just pay those off and your sales pitch will be much more accurate. Of course, I cojuld be wrong after all this is only one person's opinion. Bankers keep using scoring but get a bad loan money back gurantee from the scoring vendors before you buy.I bet you will be waiting for a long time before they back up the sales pitch with money. Oh an by the way..Title Companies and other vendors back up the service they provide money...The Scoring gurus should start stepping up too !

"The formula must be a secret, the credit industry argues, because if everyone knew the exact steps to get a good score, all consumers would do those things, and the scores would become meaningless. In other words, the score would become nothing more than an indication of how well consumers could “game” the system rather than their ability to repay loans."

That's baloney. Then their score means nothing. If it was a true representation of a consumer's ability to repay their loans, then they wouldn't need to keep their score secret. But, if you can "game" the score, then the score is already meaningless. It's all a sham.

I found this helpful. I am conscious of the use of credit cards. I very rarely use them . if used, I try to pay it off in two payments.

I totally agree with this article the credit scoring industry needs to be regulated by the goverment the same way they did in the 80's with the airlines. This makes no sense whatsoever. I can get a 2008 BMW with no problem but when it comes to obtaining a mortgage for $30,000 it becomes a problem. And it seems anyone can put anything on credit report at any time and its never a problem but when it comes time to dispute it and have it removed its impossible for the average person. We all need to revolt and form a class action lawsuit against the credit bureaus for fraud and defamation.

This was a great blog. I was just discussing the very subject of credit score mythology with friends last week. I'll be tuned in for the next episode-bet on it.

The entire concept of the credit score, even under the new 08 version has so many flaws, it is really should be banned as slanderous. Let me explain a real situation. Due to a job loss (company closed after summer of 2002 as a result of 9/11), the loan was 'late over 90 days'. The lender did not want to foreclose and be stuck with a house. The borrower secured new work, and was making regular payments each month for the loan payment amount. They were not able to 'make up the 3 months delinquent', but their acutal ability to repay every month is NOT reflected in the score. Only that at some point they fell behind and that issue continues on. There needs to be a change to allow for showing that yes, the loan went 90 days behind, yes the person has not been able to make 3 extra payments, but ALSO YES, the payment is being currently made every month. This exact situation went on for nearly 3 years. The lender saw it as golden, the borrower was paying high interest, couldn't refi because they were continually reported late, but the lender was actually getting their money EVERY month for 3 years. So the purpose of the FICO score to predict whether this person would repay was blatantly wrong, but because they refuse to look at middle ground and slant the system towards the lender, the borrower is hurt. If this has happened once, I will bet it has happened thousands more times. But it also keeps people from being able to recover from a problem and will prevent the needed growth to recover the economy from the exact people that are needed to help right now.

I'd like to correct your statement that credit scores "are relatively recent invention". In the early 70's, while working for General Electric Credit Corp. we were using a credit scoring system which assisted credit managers on loan applications. If a score fell into score of "X", it was declined with no further investigation. If it fell into "XXX" it was approved with no further investigation. Scores of "XX" were investigated, and that group usually made up approximately 60% of the total group.

The system worked, saving time and money, and eliminated most future collection problems.

Bob,
You state above that, "The secret sauce behind the FICO score remains in the shadows. The formula must be a secret, the credit industry argues, because if everyone knew the exact steps to get a good score, all consumers would do those things, and the scores would become meaningless."
I beg to differ on this point. I have been in mortgage lending for several years now and know first-hand that the general public DOES know what they need to do to obtain a good credit score. You said it above, “Pay your bills on time, and don’t max out your credit cards.”
I would say 98% of the public knows that if you take credit out on something, you have to repay it. The other 2% must think it's a gift or something that doesn't need to be paid back... I am assuming their reasoning here.
Either way, the basics behind credit scoring are common sense and aren't difficult to comprehend. The BIG issue here is that people with low credit scores generally fall into two categories: 1) they fall into hard times (medical, divorce, etc); or 2) they simply are irresponsible and fail to make good on a lender's good faith.
I will admit that some of the public fall victim to errors by creditors and identity theft. But, blaming FICO on causing issues with people's ability to repay is absurd. FICO is a snapshot of someone's character (as we put it in the mortgage industry). If they have a low FICO, chances are they will be less-likely to repay the debts. It isn't faultless, but it's all lenders can hang their hats on when deciding to lend or not.
When I was 19 I had a late payment on a credit card. I KNEW I needed to repay it, but I failed to do so in time. Seven years later - and many loans with higher rates due to my low FICO - my late payment came off my report and my FICO miraculously went up (a lot, in fact). I forced myself to be educated on what I did wrong and what not to do in the future (if I wanted a higher credit score). It was simple - don't be late on credit payments.
I came from a father who, up to this point, has filed for bankruptcy 3 times. What do you think I learned growing up? “Get the fun toys and don't pay for them - the government will bail me out!” I learned from these mistakes and took personal responsibility for my actions and have a great credit score today.
Personal responsibility. It's simple common sense yet it doesn't seem so common anymore. We're in an age of blaming others for our hardships and not stepping up to the plate for our mistakes in the past.
While I do think some changes need to be made to the FICO system (minor, at that), I will say that until the 98% of the American public takes personal responsibility, it will have to remain in place and mostly the same.

It is really sad when the lower your score the higher interest you pay...imagine someone trying to pay off debt and cannot catch up because of this. It is a crime to rip someone off based on their credit score like that. A person gets into something like debt because of a loss of job and the only way to afford to live is by paying with a credit card then for the next 10 years has to get stuck in the rear with interest rates so high its almost like a never ending battle...come on cant some fix this?

I have gone to our state senator about these credit reporting agencies who are neither congruent with their reporting nor easy to deal with. Did anyone ever consider the fact that it is very easy to put something on this report and it can take years to take it back off not to mention it is labor intensive to do so. The credit score seems to have nothing to do with timely payments and they sell of the credit information regularly if you note all the inquiries that are on one of these.

This is a system that is indefensibly arbitrary and prejudicial. It helps neither the consumer/borrower (afforded credit - or not - based on stupid assumptions) nor the lender (making bad loan decisions based on the same stupid assumptions). The credit scoring system is dysfunctional and in crisis. The government should intervene and set uniform, simple, fair standards and prevent abuse of the working poor, young, and single people. The FICO scam should be scrapped.

The system is a totally corrupt example of outsourcing responsability. In stead of taking a look at your creidt history themselves, creditors (and to be frank, anybody that will give you any monthly contract) relies on a credit score that nobody knows how is it assembled.

It is outrageous that consumers do not have the right to know on what exact grounds a creditor or vendor evaluates them. The creditor and vendor should not be allowed to hide behind a number that they themselves don't know how it assembled.

In short, the process is less transparent than the election process in communist countries like the old USSR, China and Cuba.

My frustration is with the credit reporting agencies! My husband has a very common name and his credit has somehow been "combined" with an individual with the same first name and a one digit difference in their SS#. We clean it up and then it happens again. Clean it up, it happens again. Talk about ruining our FICO score and ability to get loans. It's a frustrating mess! The agencies make mistakes all the time, one I believe has even been sued, yet nothing changes.

"Possible role" - let's get real. The financial industry bought whole hog into the FICO myth and mortgage lenders made it virtually the ONLY credit criteria for making loans. It is THE reason for mortgage meltdown.

Let's keep it real, we as a people need to do away with this FICO score. As a nation and as a people, we have gotten along well before it appeared on the seen. People have gotten rich and most have been ruin by this program. Anything that decriminates, promotes greed, and selfishness, divides the country from prospering. We need to start treating people like people and stop treating people like a number!

This is really informational.

The entire system stands flawed, highly outdated, ultimately subject to abuse by self-serving, unethical companies that flatly refuse to correct egregious errors, unevenly applied, discriminatory, and progressively irrelevant to the current complex world of finance, credit, and personal responsibility. How about a little glasnost in the system, or better yet, take those steps requisite to rendering the "Big Three" neutered/spayed.

Yes, I believe credit scores should count toward many things but there are many people out there work every day some 24/7s to get what they want and where they are in life. I have a 4 year old child she is a dream I always wanted. There was so many times before I did have my child, I asked myself should I bring a child in this world? Six years ago my boyfriend of 16 years bought a home made it into a castle for me. Told him don't do this I would be happy living in a paper box. I was raised by two great people my mom and dad they taught me to be happy of what you have. Today we have a business and live on a farm. Till this day we work 24/7s for what we have. We are going through a bad time in our lives now, trying to refinance our home can't because our credit score. We worked very hard, we were raised that way. We don't blame no one for this time we took a wrong turn in our lives. I read your story about credit scores maybe rating a person on their credit score is some ways I like to repeat that some ways that the world in this way it is..........

Credit scores provide a tiny reductionist view into peoples financial life. A diligent lender will examine total debt load, income, job stability, assets and future prospects. Many lenders are only interested in making loans quickly - lenders money does not grow sitting in the vault. However no one is well served by poor lending practice. Lenders suffer losses on defaults, and borrower's lives can be seriously damaged by taking on loans which ultimately they will not be able to support. It is the job of the 'expert', the lender, to help the borrower to understand what they can afford. They owe a fiduciary duty not only to their employer, but to the consumer who pays the interest which supports their salary.

If you can't pay cash, you can't afford it. Cars included.

I'm greatful that the credit bureau and this FICO business is closely being looked at. We are counted as a number in every aspect of our lives. However, we are not numbers we are human beings, and life is life, and guess what (life happens to all of us). Most of us try to bounce back when bad things happen and have a deep desire to restore our lives and go forth. Too much power is given to the credit bureaus and the FICO score. STOP CHOPPING off the legs of American with this MESS.

Some credit card companies (such as Washington Mutual) offer your FICO score for free.

I think it's horrendous the way credit scores are calculated. One of my credit card companies recently changed the deadline for my payment, and since I didn't notice the date had moved up (I pay online, so I hadn't been opening the mailed bills), I continued paying it every month at what I thought was the right time. It wasn't until two months later when I noticed a late fee being assessed that I checked the history and saw that two payments in a row had been marked as late. Naturally, they were immediately reported, and for the first time EVER I have two late payments on my credit report. Granted, I made the mistake, but it was an honest mistake, and I never actually missed a payment! So I am no more un-creditworthy than I was two months ago. Do you think the credit reporting agencies care? The system is bogus!

The whole credit score system is a continuing joke (and plague) on the body politic. I personally do not care what my current credit score is, or will be tomorrow. I simply live prudently and work to minimize my expenses. (Refinancing from a 30 year fixed 7-7/8% mortgage to a 15 year fixed 5-1/4% mortgage during the run-down of interest rates is an example. Clearing a credit card to $0 and retiring it is another.)

PS. Those millionairs need only go to their bank and say "I need a credit card with a $x,xxx limit. Please issue me one, or I will change banks (and you will lose $xxx,xxx in deposits)!" Funny, they cave every time.

So, in short "Fair Isaac" is fair in name only, it is selling a crock of manure that stinketh!

PS. Those folks used to be a part of CDC. A tale of a computer manufacturor (and creator of jobs) turning to the Dark Side. Do mapquest on Arden Hills Minnesota, Fair Isaac is just north of Co. Rd. F on Lexington Parkway.

I deal with credit scores DAILY. It's simple really... PAY YOUR BILLS ON TIME, DON'T ABUSE YOUR CREDIT CARDS, DON'T GO BANKRUPT AT THE DROP OF A HAT, and did I mention.. PAY YOUR BILLS ON TIME!!

If you have $40k of credit debt, your score will be low.

If you pay said credit card bills late, your score will be low.

If you've were 30+ days late 20 times on your last car loan, your score will be low.

If you've declared bankruptcy, your score will be low.

If you bought too much home (your fault, not the bank's) and it's now in foreclosure, your score will be low.

If you decided to not pay your $400 cell phone bill and it's now in collection, your score will be low.

If you decided not to pay for medical services and it goes to collection, your score will be low.

I could go on and on...

Be responsible, live within your means, pay your bills ON TIME, and you'll have a HIGH credit score.

It's really very simple.

I had ck. my credit score then had a mortgege broker ck.it looking to by a house they were so far a part can any body anser this ?

I don't know if this applies in the US or not (I'm in Canada) but here you can always get a copy of your credit report at no charge - as long as you are willing to wait for a report in the mail. If you want to get it on line you have to pay. This is not generosity from credit raters, it is law.

Forgive me if someone has already mentioned this. I just wanted to state that credit scores are designed to predict the likelihood of a consumer being 90 or more days late on a payment in the next 24 months. Any quantifiable behaviors or characteristics that point to the increased or decreased likelihood of this occuring will be taken into account in future revisions of the credit scoring model. This is why the scoring model must be updated periodically. Also, the more quickly the credit market changes, the more often the credit scoring model should be changed to reflect what is going on. It is no surprise that in the present financial situation a new model will be coming out soon. It is also no surprise that the exact scoring model is not made public, because then people would try to work the system, thus negating its predictive purpose.

The best part is when credit scoring is sold to non-credit issuing companies - like - Insurance for example. That way - some very good people can pay more for coverage in addition to paying more for credit. Meanwhile - Fair, Isaac makes piles of cash with no responsibility for the results. I was in finance too...

the information in the story that stated that a score of 619 would pay double of someone with 720 is completely false, yes they will and should pay ahigher rate but nowere weve close to the overesaderated #'s in the story. Bob Sullivan should do a little more reserch on the things he writes about instead of trying to use the scare tatic.

This is an EXCELLENT article and topic. I am a Mortgage Banker and I personally witnessed the fraud caused DIRECTLY by the use of credit scores.
It is a crime that the three credit bureau's
(Experian,Transunion and Equifax) are allowed to report derogatory information that is old and duplicate or accounts that the consumer has paid but still reflect they have not been paid.
THE BURDEN OF PROOF IS ON THE CONSUMER!
If I review ten credit reports, on average nine reports have some sort of wrong information. Ranging from address, job history, name/ alias, accounts and account history. Most of which, the credit bureau's state are used to determine the score.
There is no hope for the consumer that is a Jr. or II / III etc. That persons credit report will be linked to their Sr/ Jr. FOREVER !!!!
1.In the days of the mortgage boom, a young college student would listen to an info-mercial on television and instantly they are an " investor " .
2.Armed with their 700 credit score, no job or work history, this 20 year old college student would apply for a " NO DOC " or " STATED INCOME - STATED ASSET " loan, that offered 100% FINANCING. The seller would pay the closing costs in most cases. So there was no out of pocket expenses to the 20 year old
" investor".
So they would amass up to 3 properties or $1 million dollars in loan amount.....PER LENDER !!!! They would work with as many lenders as possible that offered the " NO DOC OR STATED INCOME STATED ASSET- 100% FINANCING " loans.
3.There is a misconception that " sub-prime" lenders are just small "mom & pop" shops. This should be clarified because 95% of all the large banks created their own "sub-prime " division, under a different name. Therefore they played a big role in the debacle, eventhough now they are attempting to distance themselves, as the good guys.
4.Conversely, the person that has been on their job 15 years, has a debt ratio below 30% of their income and has 6 months reserves in the bank, did not qualify for a loan because their score was only a 580, due to the fact they have no "NEW" revolving credit.
The old derogatory credit, that has since been paid off, still reflects he/she owes the debt because when it was paid off, the creditor did not contact the credit bureau's to inform them.
The average consumer is not aware that the burden of proof is on them. Therefore, once the debt is paid, they automatically assume, it will be corrected on the credit report.....THIS IS NOT THE CASE !
5.Additionally, the antiquated process consumers must go through, to provide proof to the credit bureau's, the credit report is inaccurate, seems to be designed to cause delay, confusion, frustration, embarrassment and ultimately a loss of interest, on behalf of the consumer.
Which benefits the credit bureaus and their paying clients, the creditors!
6.To conclude, the credit bureaus do not work for the consumers. This system is designed to help creditors earn more wealth, by giving them justification to charge higher interest rates. Qualification is not based on relevant facts, such as job history or money in the bank. It is based on a mysterious score based on an inaccurate report !
But another twist ( and larger underlying issue )is, if you are an investor and you have stock in one of the companies that are making huge profits, you would want them to continue to make those profits, by all legal means....to include raising interest rates to consumers with low credit scores.
If America changes the way it grades consumers on their ability to repay their debt, to a system to protect consumers against creditors. It would directly adversely affect the stock market, overnight !

But our Federal Government and local representatives have a responsibility to protect its citizens from such a process that is designed to steal money from its citizens. All Americans should be outraged by this process and write to your State and Federal government to have the credit bureaus outlawed all together!
This would force unscrupulous lenders ( which includes all lenders that use this system ) to offer Americans fair interest rates based on their job history and money in the bank.

I just checked my credit report and score then applyed for a mortgage loan to by a house the credit score numbers they each came up with were night and day do they the same systems. ?

Another big problem with reports in general is the type of stuff that's on there - which (only) has negative affect, couple with the fact that anyone can, at any time put anything on there whether it's true or not (the problem increases exponentially when any third party collector gets involved). Good example: Items that have nothing to do with credit. For example, non-monetary judgements, judgements unrelated to credit, medical bills that went directly to collection with no bill ever sent (medical bills, IMHO, do not belong on credit reports anyway), and the same accounts being listed multiple times, in multiple forms for the same thing, etc... Additionally, most 'errors' are deliberate misrepresentations to make the situation look worse than it is.

All these things figure into the score and none are related to credit. Further, the fact that credit reports (as useless and inaccurate as they are) are being used for things that have nothing to do with credit. If that practice continues, it will eventually bring down the economy, much worse than this current 'credit crunch'.

Loved your article. I have one question. Does it count against my credit score if I want to view my credit reports every 2 or 3 months? why should it if it does?

The whole "credit score" system is a farce and I have been able to exploit the system to an extent. Here's how i did it. First, I opened 4 accounts at age 18, they were crappy cards with high APR's and low credit lines but that didn't matter. I actively used them but did not max them out. I would make small purchases on them and pay the entire balance every billing cycle. Within 1 year all of the lenders raised my limit by $5000 so I now had $20,000 of credit even though I made minimum wage. Then, I OVERPAYED by $100 on each account and stopped using the cards and let the extra money stay on the account. This confuses the lenders because now they owe you money and they hate that. They called everyday but i ignored it. I repeated this for the next year and they each offered to raise my limit. Heres the important part, DECLINE THE CREDIT INCREASE and ask for a lower APR instead. 3 of the 4 lenders agreed to lower the APR. I closed the 4th account. As soon as I got the better rate, I called back and accepted the increased credit and they granted it. I now had 3 cards with $10,000 credit lines at 7% APR even though I worked part time for minimum wage. I continued to use the cards sparingly and always paid the balance to 0 within 2 payment cycles. After 6 months I started getting all of the top credit card offers. I did some negotiating and finally settled on a Visa platnum with a fixed APR of 4.9%, cash back rewards, no fees and a $50,000 credit limit. Here's the kicker, I haven't worked for 2 years! I closed all of the other cards and I only use this card. So, thats how to go from no credit to perfect credit in about 3 years. This isn't really a scam because i never broke the law. All I did was manipulate the data that the credit card companies use to make lending decisions. My advice to anyone having problems is DONT USE CREDIT, USE CASH OR DONT BUY IT. Remember, this system is designed to take advantage of the poor and uninformed. (I'm poor, but I'm well informed). That's why the whole credit formula is a secret. It's because the lenders don't want informed consumers like me. They want you to be late so they can take more money away from you. That's how the game works. Now, my credit score is 795 and I pay the lowest interest rates around for everything plus low car insurance. Lenders think I'm well off because my credit is perfect. If you want to learn more go rent the movie "Maxed Out" and enlighten yourself.
Good Luck

glad to see all the discussion. I lost credit points because I bought a car I could afford instead of a more expensive, newer one. I've had banks charge me for checks that were written from a closed account...also taken years, I mean YEARS to fix incorrect information on my report...and I still have a decent rating. I know there are way too many people out there who do not have the perserverence or tenacity to fix these kinds of problems. When they cut my rate because I bought a car within my means... I just let it go...if I end up living in my car like one of the bloggers...so be it...like her, I'm just too old and too tired to deal with this anymore. Glad to know there are others ready to pick up the banner...good luck.

I just checked my credit report and score then applyed for a mortgage loan to by a house the credit score numbers they each came up with were night and day do they the same systems. ?

The whole "credit score" system is a farce and I have been able to exploit the system to an extent. Here's how i did it. First, I opened 4 accounts at age 18, they were crappy cards with high APR's and low credit lines but that didn't matter. I actively used them but did not max them out. I would make small purchases on them and pay the entire balance every billing cycle. Within 1 year all of the lenders raised my limit by $5000 so I now had $20,000 of credit even though I made minimum wage. Then, I OVERPAYED by $100 on each account and stopped using the cards and let the extra money stay on the account. This confuses the lenders because now they owe you money and they hate that. They called everyday but i ignored it. I repeated this for the next year and they each offered to raise my limit. Heres the important part, DECLINE THE CREDIT INCREASE and ask for a lower APR instead. 3 of the 4 lenders agreed to lower the APR. I closed the 4th account. As soon as I got the better rate, I called back and accepted the increased credit and they granted it. I now had 3 cards with $10,000 credit lines at 7% APR even though I worked part time for minimum wage. I continued to use the cards sparingly and always paid the balance to 0 within 2 payment cycles. After 6 months I started getting all of the top credit card offers. I did some negotiating and finally settled on a Visa platnum with a fixed APR of 4.9%, cash back rewards, no fees and a $50,000 credit limit. Here's the kicker, I haven't worked for 2 years! I closed all of the other cards and I only use this card. So, thats how to go from no credit to perfect credit in about 3 years. This isn't really a scam because i never broke the law. All I did was manipulate the data that the credit card companies use to make lending decisions. My advice to anyone having problems is DONT USE CREDIT, USE CASH OR DONT BUY IT. Remember, this system is designed to take advantage of the poor and uninformed. (I'm poor, but I'm well informed). That's why the whole credit formula is a secret. It's because the lenders don't want informed consumers like me. They want you to be late so they can take more money away from you. That's how the game works. Now, my credit score is 795 and I pay the lowest interest rates around for everything plus low car insurance. Lenders think I'm well off because my credit is perfect. If you want to learn more go rent the movie "Maxed Out" and enlighten yourself.
Good Luck

Dee -

A bill must be 30 days late before it can be reported to a credit bureau as a permenant late. There is a 'past due' indicator but this drops off when it's paid in that 30 day period (most places will not put a past due on there anyway). So, your getting screwed - and this should be addressed with the company - don't let it go.

BTW - the moving due dates are an attempt to extract a late fee, and the practice should be outlawed.

So far my husband and I have been very lucky. We're in our mid twenties, pay off our credit cards every month, and make our payments on time. We recently had our credit scores pulled to be pre-approved for a mortgage and found out were both in the 760's. A friend who is also getting a mortgage (and is in his early 30's) is 100 points lower.

All of my credit cards are at a zero balance and have been for several months. It is amazing how the credit card companies call me everyday and send offers in the mail to entice me to use my credit cards. I am in control because I don't owe them anything. Whenever I decide to use my credit cards I will pay them off in full the next month. My grandparents never had credit and owned cars, land and everything in between. We must control our spending, and not live above our means. A lesson to be learned by many of us.

And most folks don't realize that auto insurance companies use credit scores to set rates. They say that people with low credit scores have more accidents???

There's no math, here, Bob. FICO has deteriorated into some secret number, derived from the sort of arcane, illogical hoodoo that drives Wall Street. In practice and application, it has the same relevence and meaning as zodiac, tarot or goat entrails. But it ain't math.

FICO is a joke. My mother had never paid a bill late in her entire 72 years of life, and had one card -- a Sears card -- with a limit of $20,000 that she had for over 30 years and NEVER, EVER, EVER carried a balance on.

Her score? 540.

This lady had more money saved up and lived a frugal life and for what? So some worthless corporation can assign her a number and tell her she isn't worth anything?

FICO is worthless. Absolutely, positively worthless.

I'm laughing my head off at these posts that tell people "pay on time and don't run up debt and your score will be high". They obviously don't get it.
If you take out a new loan, it changes your score....and after that loan isn't new anymore, the score DROPS. Even if you paid on time. Even if you aren't running up debt. Why? Because you get moved into a 'different category' of consumers.
I recently was informed by a credit card company that my interest rate was going up due to my credit report. I've been paying down debt for the last year. I've made all my payments on time. Why is my interest rate going UP and my credit score going DOWN? Because I'm paying off the debt. I'm no longer a good debtor because the creditors aren't making enough money from me.
The entire process is designed to reward debt, unless you don't play by their rules, which as everyone knows, are confidential.
How has our society bought into this nonsense?
Perhaps we need to boycott the banks.

I am in finace. Transunion, Exuifax, and Experian all offer a free "dispute" option to remove any derogatory information on a credit report. Whether or not the information is derogatory it can still be removed. This costs you nothing.

There is no magic bullet to repair credit, but simply disputing any information works a high percentage of the time. If they cannot verify the derogatory item, they HAVE to remove it. Many of these companies who have reported you derogatory have been purchased, merged, or whatever since the report (if its a few years old), and likely wont be able to verify it. Also, the person verifying is an hourly employee who has no stake in the outcome of the verification. So if they get fed up with jumping through hoops to verify, they will most likely just remove it since it will be the path of least resistance...

don't get sucked into paying someone who says they can improve your score for a ridiculous fee. It only takes a couple hours of your time, and you will see things removed..

To the guy who says he's 900 on all three beaureaus, you must have some good crack.

I've been in finance for 15 years and I have run thousands of credit scores from all reporting agencies...Never seen anyone past 860 on any of em...

keep smokin pinnochio....

To Rebecca who wrote "Pah... I've been paying my bills on time, have a nice cushion between owed and available on my credit cards, and the limits are low... yet I have a 542 while my husband who has MORE credit and therefore owes much much more, has a 724. The difference? He has 2 years more of credit history that I. Fair? Far far from it."

You are not being totally honest about what is on your credit file or are missing something on your and your husbands crdit reports because the length of a person's credit file is only about 10% of the overall score. The big difference in you and your husbands credit score isn't that his file is 2 years older. It is something else. Paying on time and the percentage overall based on total credit used VS total available counts for about 80% of your credit score. Inquiries (how many time you apply for credit) about 10% (the fewer the better) average length of your credit lines equals about 10%.

I will admit that my husband and I were stupid when we were younger and made bad credit mistakes. We had to file bankruptcy to start over and since then we have learned. I recently lost my job and had to rely on credit cards to pay some bills until I could get another job and in doing such I learned a lot. I am now working and struggling to get everything paid off. After talking we decided to try and get a mortgage for a house and are having extreme difficulty because my credit card balances are too close to the limit. We have worked hard to make up for our mistakes and to date we have done well. But now all of a sudden we can't do much of anything all because something that happened was out of my control. That just doesn't seem fair. The mortgage guy even said everything looked perfect, no late payments etc. But somehow I can get a house in such a low price range and in such terrible shape that I wouldn't even want my dog to live there. Something just doesn't seem fair.

WOW...some of these comments state ..."pay your bills on time, etc, etc." My FICO score is a low 634 yet I have NEVER paid a bill late - did I say NEVER - however I do have a lot of credit because making payments makes MY life easier. My gripe here is that once you are granted a credit limit by a card company then WHY are you punished for using all of that limit that THEY ALLOWED you???? I can understand it if you go over that limit, but not if you stay within it! It is just another excuse for them to abuse the consumer!

Also, with insurance companies using credit scores... Studies have shown that people with low credit scores tend to be a higher insurance risk. Not to mention paying their insurance premiums late.

It's a fact, people... The world revolves around credit. You might not like it, but there's nothing you can do about it.

Wake up people! This whole credit score game was invented by the banks to get the sheeple to pay their bills on time. You don't need credit, you need cash. If you have no debt, you have cash.

What credit scores don't reflect is the people who SAVE up to buy big ticket items like cars.

To John Doe in NC....The max score you can have is 850!!!!! Where are you getting your scores from?

The whole credit score is bogus. My parents recently divorced and my father called Capitol One to remove my mother from the credit account. Sent copies of the divorce paperwork and explained that him and my mother divorced. Capitol One then proceeded to remove my mother from the account, and keyed in deceased instead of divorced. My mother is now being reported to all the major credit bureaus as deceased. After several phone calls and letters, this information has still not been corrected. It has been over a year and it still has not been corrected. The credit card company Capitol one continues to report her death. They changed my mother's credit reports to deceased without so much as a death certificate. I have no faith in a system that can ruin a persons life with no reprecussions.

These credit reports are bogus. I got slapped with a lower score because I used my good credit to buy hookers. Never mind the fact that I paid it all off on time, I still got hit with a lower score and higher fees/interest because I was being judged by what I was spending my money on...a counselor said that buying prostitutes was mainly the reason my score is in the 600-625 range. That's bull. Now I just masturbate. At least my credit is improving.

this is all B S, just another way for two guys to make tons of MONEY, and as usual people are so stupid they run with it, i say to HELL with credit scores, credit cards, SHOVE them you know where, this is CORPORATE AMERICA, screwing the average person as usual, who the hell are these companies that they should control peoples lives in this WAY.

When it comes down to it, your credit score only means something when you need to use it. It doesn't take into consideration that your mortgage officer fraudulently got you into a mortgage that you couldn't afford. BC of the current situation of the US, I think that everyone's credit score should be wiped clean and have everyone start over!

I have been in banking and bank regulation for 20 years. I have found credit scoring on both retail and commercial credit to be highly predictive of future borrower behavior. To parrot a couple of other commentators, pay your bills on time and use credit prudently. To blame the current debacle on credit scoring is beyond naive.....While there are spillover problems in "A" credit, the subprime market is the primary driver for foreclosures, bankruptcy etc. This means that credit scoring actually WORKS, if you pay attention! However, greedy lenders do not. It does not help that we are an acquisitive, "gotta-have-it-now" culture. Also, to those who suggest a cash only culture, GET REAL.

I was a single mother for 13 years, making on average $8.50 an hour. I did not have credit cards, but of course had to have a home and car. I do not remember very many days that I did not worry about having enough money to take care of my child. I would worry about how being late would affect my credit score, and my ability to borrow money should I need it. I am now 50 years old, and realize that I, out of necessity, made myself miserable worrying about credit scores. It would have been easier on me to let the government support us, but self-respect and pride, and teaching my child these things, was much more important to me. What I actually want to say, is I believe it is wrong that people must lead their lives worrying about numbers. Life happens, and hardships happen in these lives. Their must be a better way. I admit I am not sure what it is, but there just must be one. Surely the high paid government officials could stop for one minute, and maybe focus on assisting the people in this dilemma instead of punishing them. I believe we do pay their salaries.

Why aren't the credit agencies and collection agencies required to check the accuracy of information they post? The scores have gotten out of control when you apply for a $8.00 an hour job at Linen's and Things and they run a credit check. Since when did your debt ratio affect your ability to perform a job? So, it can be assumed that these companies by not requiring a check to make sure the information is even accurate are directly responsible for some people not being able to find work. Pretty sad.

These credit scores are insane. I have a 780 from one bureau, and a 690 from another, they use all different equations. They DO NOT count income at all, because income is not credit. You could make a mill a year and it would not matter. I am getting to the point where i could care less about these scores. They kind of rule your life, which is wrong.

I have a potential foreclosure and don't even care that it will be on credit, i make enough money to handle it

It's true that the credit scoring system is not perfect, but its better than nothing. In the old days when the credit scoring system was not used, men were primarily in the workforce and divorces were uncommen (so women had no need for credit). In today's world, there are alot more people who can default on loans. The whole reason for the credit scoring system is to predict who will default on loans and who will not. This protects the economy as a whole by keeping interest rates as low as possible, since the money earned from interest rates also recovers money lost due to defaults. It's also true that the credit score does not take into account debt to income ratio-the banks do when considering whether to give you the loan. The credit score is not the only thing lenders look at. They also look at employment history, debt to income ratio, assets, money for down payments, etc. I agree that the system isn't perfect, but it does have its advantages. One main advantage is the ability to correct errors, as well as the ability to improve the score with a little discipline. I've worked hard to get my score to 750, and love the fact that I have the ability to pay a lower interest rate than someone who doesn't care about their credit score. If it wasn't for the credit score, we all would be paying the same interest rate, which would be higher for everyone, since almost everyone with a job would qualify for loans, regardless of their past mistakes.

To John the Banker in Miami: Hat's off to you. I'm glad to see your company doing that for the customer. Although the customer should already know that if you make $ 40,000 a year, you probably shouldn't buy a $300,000 or $ 400,000 home. But that has been a problem with alot of lenders. They look at the customer and say," You only make $30,000 or $ 40,000 a year? No problem! We can get you in that 300,000. home." And within a year, they are in foreclosure. When most of us were young and first married, we either lived in a rental house or a trailor until we could save up some money for a house. My husband and I have been married almost 20 years and just purchased our first home. My parents had been married for 25 years before they purchased their first home and they have been married almost 58 years and still live in the same home. These days some young couples are actually purchasing a new expensive home before they even say their vows. You can't always afford something just because some lender says you can. Look at your finances and make the decision yourself. After all, most everyone has enough schooling that they should be able to add and subtract to see what they can afford. Homeowner in Alabma

Credit card and financial companies create the system to benefit them not you. The all have different rules that are not intuitive and are difficult to abide by so they can make more money from you. For example I had a credit card that required payments to be made by 12:00pm Eastern time on the due date. If they weren't they'd charge you a fee and jack up your rate. I had another card that if you surpassed your balance they'd charge you 40.00- fine, but if you continued to be over that balance on a particular date which in my case was 6 days after my due date they'd charge it to you again the following month.

To woman who used Sprint, I recently changed to them and I'm not happy about how they charge fees on internet usage. The charge you likely got was a casual usage charge. When I got my phone I didn't really know how to use it- my 1 year old kept playing with it and hitting buttons. I requested that I not have internet access which they charge for. Most of the crap that comes on my phone tries to connect you to the internet. As soon as the request is made to connect they begin charging you. I never intended or actually connected to the internet but was charged 50.00- I didn't understand first of all how I could be charged if I did not successfully connect- then I couldn't understand why I would be allowed to since i asked them to disabled that functionality. I ended up getting my money back a couple months later but then continued to have billing issues- watch them closely.

Dee, late payments only get reported when they're 30 days late. So in your situation, your credit score shouldn't have been affected.

The fact that someone with a 619 score will pay an interest rate double that of someone with a 720 score is not overexaggerated. It happened to me. I had a 620 when I purchased my vehicle and got an 18% interest rate. I have thought about refinancing but that will bring my now 687 score down again for a time. And now since prospective employers use this information as well I am trying to keep my score as high as possible.

I just checked my credit report and two credit bureaus had a similar score but one was 100 points lower due to several errors. I am tired of being a hostage to the credit score.

Oh my, let me tell you what happened to ME with AT&T! Back in 2002, I had telephone service (long distance included) with a company called Excel Telecommunications. Out of the blue, I received a letter from AT&T thanking me for cashing some rebate check they apparently sent which someone else received and cashed, authorizing them to switch my long distance service from my then carrier to theirs. I called AT&T and spoke with 2 different representatives explaining to them that I did not require their service, never asked for their service, and I did not who cashed their rebate check, They stated they would close the new account. Next thing I know, a month later, I'm getting a bill from AT&T for $41.43 for long distance charges. Here I go on the phone with them again. My then telephone company even got on the phone with AT&T and informed them that my long distance service was with Excel. AT&T still sought to charge me. How they even obtained my social security number to place that charge on my credit report is far beyond my understanding to begin with when I had never ordered service from them. But just that little bill has had such an impact on my credit score. Creditors are like "Gee, if she can't pay this little bill, why should we bother with her?" I'm still fighting AT&T to get those charges taken off my credit report to this day. I can't stand AT&T. That they would stoop so low as to switch some anonymous person's long distance service without their knowledge or authorization, then slap them with a bill is beyond sinister.

Attention people! paying your bills on time does nothing, I repeat nothing, to improve your credit score. In fact, paying on time can be a detriment if you pay the balance in full. Paying your mortgage on time will not influence the credit score. However missing a payment will hurt. The only thing that improves this screwed up method of credit approval is to not, I repeat not pay the balance off. I found out through my credit card company after many attempts to lower my intrest rate. The only way this score will improve is if the credit card company makes money. They do not make money when you pay your bill on time, in full. This will lower your score. When they can charge you intrest at the astronomical rates that they charge then, and only then will an improvement in credit score be realized. My score improved 100 points in less than 6 months when I started running a balance on my one and only card.

I payed my bills on time then I lost my job. Unemployed/underemployed for 4.5 months. I looked every day for a better job. But still did not have the money to pay all bills on time and support my family. Credit card companys dont care and no one else did eather. So my attude now is you get paid when I pay you. My Credit score is already rock bottom.The system needs to be fixed your insurance on your car is tied to it now. So a man with no accidents or tickets has to pay A higher rate. So watch out dont get in a wreck with me unless you have unissured moterist on your insurance.

I do not like the fact that because I have destroyed all credit cards that gets used against me. My sister has several credit cards and use them each month then pays them off the following month her FICO score is huge. I make more (2 times as much), have a home no car loans. She has several car loans no home. What a joke!! Save your money throw away the credit cards buy only what you can afford and most important finance only what you have to and then pay it off as soon as possible. Let them stick their FICO score where the sun don't shine!! One good thing about a bad FICO score is people are not as likely to want to steal your identify.
Just my opinion.

Lenders are not getting away from the credit scores. As a matter of fact, they are putting more and more emphisis on them. All the lenders are raising their credit score criterias to qualify for a loan. The rules for qualifying for an FHA loan is not based on ones credit score but rather their "credit profile". Yet most of your FHA lenders are now requiring a minimum score to do an FHA loan with them, even though credit scores are not to be taken into consideration for FHA loans. So to say that lenders are gtting away from them is false.

John Doe - I don't believe the credit scores even go to 900...so how can you be 900+ on all three?

And to the guy who said if you have $40K in credit card debt, your score will be low...baloney! My boyfriend has approximately that much in credit card debt (yikes, I know...we are paying it down), makes about $20K less a year than I do and his credit score is 750. Yes, he makes all his payments (minimum due only), but I have only student loans and about $6K in credit card debt and mine is mid-600's...
No rhyme or reason.
I also tried to get an interest rate lowered on a card I have had for 10+ years. They told me I didn't meet their criteria, but wouldn't tell me what that criteria was...so that the "integrity" of the scoring system they use would not be compromised. I told them I thought that it already was and will be paying that card off.

I do not understand how credit card company's can raise your intrest rate based on your performance with other card companies and when you pay your cards on time for years you finaly reach a temporary finical crisis and pay late a couple of months they all raise your intresrt rate to a point you can never pay them off and puts you into a futher financial posistion. All this is based per credit score companies?????????

the credit bureaus control our lives as much if not more than the government. on more than 1 occasion i have sent them corrections. going back a few years, someone at the credit bureau mixed my file & someone else. the only difference was the ss # which was ignored & 1 middle initial. she owed all of houston & half of tex. but i was the one that had to straighten it all out. one of the representatives spent so much time on the phone with me, she no longer asked my name when i called her. I found out because i was trying to buy a house & they had an outstanding bill of less than $5.00, had lived/worked at the same address & job at that time for over 15 yrs. i was on that same job for another 10 years. My current age is now used against me. i can't afford (their words) to pay for anything. i am a senior citizen, retired & trying to enjoy life. but there is no help from the cc bureaus if there has been any thing incorrect on your reports & it stays on there for years even if you fight them as i did & still do.

Its called personal responsibility, something people in the US have lost. You charge up your credit cards to the max, you finance your autos with outrageous payments, you purchase a house the is worth far less the what most people pay for it, you go out and finance just about everything that goes into the house, then, when you cannot make payments you whine and bitch like little pu#$es and blame the government. If you have such little responsibility to get you into this you deserve what you get. Now your democrats want to spend 3 trillion dollars in pork and raise your taxes. And you wonder why your economy sucks.

Why do these companys have our information in the first place. I did not authorize the release of this private information in the first place.

John Doe from Durham says "900+ on all 3 scores". This is either an obvious lie or an idiot since scores only go up to 850 and all credit professionals say that they have never seen an 850.

"The entire concept of the credit score, even under the new 08 version has so many flaws, it is really should be banned as slanderous. Let me explain a real situation. Due to a job loss (company closed after summer of 2002 as a result of 9/11), the loan was 'late over 90 days'. The lender did not want to foreclose and be stuck with a house. The borrower secured new work, and was making regular payments each month for the loan payment amount. They were not able to 'make up the 3 months delinquent', but their acutal ability to repay every month is NOT reflected in the score. Only that at some point they fell behind and that issue continues on. There needs to be a change to allow for showing that yes, the loan went 90 days behind, yes the person has not been able to make 3 extra payments, but ALSO YES, the payment is being currently made every month. This exact situation went on for nearly 3 years. The lender saw it as golden, the borrower was paying high interest, couldn't refi because they were continually reported late, but the lender was actually getting their money EVERY month for 3 years. So the purpose of the FICO score to predict whether this person would repay was blatantly wrong, but because they refuse to look at middle ground and slant the system towards the lender, the borrower is hurt. If this has happened once, I will bet it has happened thousands more times. But it also keeps people from being able to recover from a problem and will prevent the needed growth to recover the economy from the exact people that are needed to help right now.

C M, Indiana (Sent Mar 14, 2008 10:00:14 AM)"

OMG, this is EXACTLY my situation, not a job loss, it was my mom dying of cancer and I had to be on leave for 3 months, so I got behind. I immediately changed my withholding to 8 (there's only me) to have more take home pay and secured a second job. Guess what? Good ole Homecomings(whatta pal!) worked out a repayment plan for me which I followed to the letter for a year, only to find at the end that they didn't take into consideration the rate hike, EVEN THOUGH I REPEATEDLY ASKED ABOUT IT. I was told, on the phone AND IN WRITING not to worry about it; it will work itself out. Well it sure did, I've been reported late every month for the last 14 months and it continues to this day! Part of the repayment deal was I was not to be late AT ALL during the repayment period or the deal was off and I'd be homeless. These pirates were not my choice; I've been trying to refinance to get away from these idiots for the last 4 years but thanks to FICO I didn't have "seasoning" and now, I have no credit. I'm seriously thinking about walking away; I'm never at home to enjoy the stupid house anyway now, again thanks to FICO!

The ignorance indicated in these blogs is incredible. I'm sorry your extended inability to work has given you an extended inability to pay your bills and therefore lowered your credit score so you are unable obtain more credit you can't pay. Wake up, that is the purpose. They are a predictor of likelyhood of payment, (or potential for lack of), no more no less. No responsible lender relies solely on the number for the decision except possibly for pricing, unless you are at the very bottom of the spectrum, where the likelyhood of non payment is so great that no excuse outweighs the fear of what it represents. The reason everyone wanted to withold the information is exactly because of what is happening now. Uninformed activists spewing uneducated rationals about facts they don't understand about processes they don't know. Again, no reputable lender is looking to use your FICO to screw you. They just want to get their money back and be compensated according to risk. It is about objectivity and automation. It is about risk rating based on past performance and recent events. Nothing is perfect.

Why does a credit score have anything to do with getting a job? I know my credit is bad, but I have worked hard to try to stay above water and I need a job so I can pay my bills!

Since employers and insurers are now using the FICO credit score to judge my morality and worthiness as a human being, I think it's high time these sham artists were legally forced to fully disclose their "formula" and provide all information to the consumers they are screwing over for FREE. I say this and I'm a die-hard Libertarian, so you know it's got to be a big issue... :-O

I did all the correct things getting my credit cleared up. I paid off one car and paid in cash for the other. I consolidated my school loans, yet still my credit score is so very low.

The worst part? I have my degree, have experence in my field yet that is not what past employers have looked at. I have been denied several jobs I was more than qualified for for bad credit (yes I was told I was denied for bad credit) and it got so bad I ended up working at a fastfood resturant instead of in my field for two years!

I am now in a good job that does not check credit (as it does not pertain to the job) and I am part of a class action lawsuit against one of the corperations that refused me work based on my credit score.

The long and short of it is credit scores are just another way to discriminate. They can ruin lives and keep hardworking Americans out of their job fields!

I tryed for three years to get the three credit bureaus to remove mistakes on my report. I sent letters with reciepts, I e-mailed, made phone calls, and still they didnt change a thing. I quit trying all together. I don't keep up with my score anymore. Sometime ago a I applyed for credit and was turned down because of my score. After explaining to the lender that my credit report was wrong and showed reciepts the only advice the banker gave was, "bring your score up and we can make the loan. If you get a credit card and keep in good standing it might help to raise the score." I couldn't believe he said that. I make good money, I have never had a credit card and never will. I cant see paying someone interest to spend my own money. We need to come together as Americans on this subject, or the greed of some will cause the downfall of us all. And to anyone who thinks the credit bureaus are doing their job you may want to consider this. You may have made all the right choices, and have been lucky enough not to have any hard times come your way, but what about your children and your gandchildren?

I've been in lending for nearly 20 years and have never seen anything like this. First off credit scores are NOT AT ALL a reliable reasonable factor in underwritng a loan. THEY ARE FLAWED TERRIBLY!!!!! Secondly it's the banks fault as well. They refuse to spend the extra nickel to hire a true underwriter or credit analyst. Why pay for that all we need is someone that can read a score. It's all been based on greed to guys from Minneapolis found suckers to pay for a flawed system and said suckers bought into it and put every egg they had in that basket to save 10 cents. After all that 10 cents had to go to the sharholders. Come on corporate America stop the nickel dicking pay the price for quality work and stop chasing the rainbow. There is no magic bullet. The 18 year old with the 750 credit score that paid his 10 minimum payment on the vise card for 3 months doeasn't qualify for the $500,000 mortgage you made him. However the couple in their 50's with 20 years job time but a few dings form last years sickness and a 620 might, and at less than 16% interest!!!!!!!

I think that the credit scoring system is a big disappointment to society. espically for those of us who work hard for what we have. As a mattter of fact, the government is a big rip-off. i know people who could care less about paying their bills have a better credit score than people who pay their bills on time. Case in point, my auunt went to purchase an automobile ( and see pays her bills on time)and was told that she needed a co-signer. Knowing that her husband doesn't pay anybody on time fi he pays them at all, guess what? He has a better credit score than she does and ended up co-signing for the car. Go figure!!

To Scott in MI....yes according to you it's simple enough to maintain a good credit score. I'm guessing you are probably quite young and haven't really had too many problems in life yet. For your information not everyone who has bad credit has it because they are irresponsible. Personally I have always been a very responsible person, paying my bills on time and trying not to overextend myself. The first time I ran into trouble was when I went through a divorce and my ex refused to pay on any of the joint debts preferring instead to file bankruptcy. I could not afford to pay the mortgage myself as well as all the credit cards so I followed her down the backruptcy path. Dumb move but I really had no choice. Fast forward 8 years and my credit was building back up again, bought a house before the housing boom, things were going great. Took out a second on the house and the credit offers were pouring in. Still I tried to be responsible and refused to use the credit cards unless of an emergency. In June of 06 I got laid off of my job and to make a long story short I was unemployed for six months altogether. Couldn't make the mortgage payments, credit bills started adding up, and before you know it Boom there went my credit again down the tubes. Collections, foreclosure, you name it I have it on my credit report. I didn't just stop making payments because my monthly pmt went up. I didn't just walk away from my house because the value went down. I tried to work it out with the bank but they were not interested in working it out. So while my credit is whack I am now making a 6 figure salary and can afford to buy a lot of things with cash but if I want to buy anything with credit forget it. My credit reports are crap and if that is all lenders base their decision on then I will not be buying any big ticket items for a long, long time. I don't really care except that it affects other things that it really shouldn't like auto insurance, etc. What is that all about???

Rebecca, it's not the credit reports fault that you have a 542 score. You mention that your credit is great but I need to tell you otherwise. You have to actually TRY to get a 542. This is a combination of maxed out cards, collection accounts, late payments, and probably a BK too. A few late payments here and there will not bring you anywhere close to a 542. I am not saying you are a bad person but you need to come to reality that there are some serious issues going on with your credit that you may be unaware of.

To the person who wrote,"The ignorance indicated in these blogs is incredible." You don't have a clue. Your lack of understanding the content of these blogs clearly indicates your level of reading skills. The system needs to change.

My wife and I have gone to a NO credit lifestyle. Other then our mortgage (which will be paid off VERY soon) we pay everything with a debit card linked to checking or an AMEX card for those things we want an extra bit of protection on, and we pay that off every month.

I have no idea what my credit score is and as far as we are concerned those credit companies can all go jump in a lake.

The only ones getting ANY benefit from the credit reporting industry are the ones who supply the information and they should be investigated, fined and or jailed if found to have supplied ANY inaccurate information. It should be their responsibility to verify beyond a doubt that any information is 100% accurate before they supply it to ANYONE. This is just my opinion of course.

Too many people who responded make emotional comments rather than simply based on the purpose of the credit score.... the person who wrote and explained that different agencies create credit scores for different reason was dead on. Although not one who works for anyone who relies on credit reports I think people have to put themselves in the shoes of a lender. Would you borrow your friend money who has a losey history of paying? The point was though, there are different scores for what the lendor is looking for (and it has to do with nothing else