Transunion, Equifax, Experian, FICO Unfair scoring methods, Inaccurate Reporting, Invalid verification. Ripoff Nationwide

Steve, I'm afraid you are caught in a lie. Earlier you stated that you know of exactly what goes into a credit score. I'll give you the benefit of the doubt and say that you just think you do but really don't. Anyone who does a little research can tell you that the FICO score given by the 3 major credit bureaus is generated using a system developed by an engineer Bill Fair and mathematician Earl Isaac. How the score is generated is proprietary and protected under law. The fact is nobody but these two guys know exactly what goes into the score. They have released information on what makes up the score but never all of it. Of the top 10 factors they say goes into the calculation only 2 of them are within the control of the consumer. Yes, it's not fair. Also, how fair is it that a consumer is always on time with a payment and then the firm decides to penalize you because of the drop in your credit rating due to other factors. It's happened to me. Yes, it's not fair and if anybody thinks that's fair is closed minded. I suggest you do some research before you brag about knowing something that you don't.

Elaine,

The biggest factor causing the large variance between CRA's is that some creditors do not report to all 3 bureaus. If you have one or more accounts being reported to only one or two agencies, the other one will be substantially higher/lower as a result.

Also, each bureau has slightly different scoring criteria as far as the number of points assigned to each item, etc.

Also a factor is positive items left far beyond the 7 year reporting period by some agencies.

Shouldn't the 3 credit bureaus be reporting approximately the same credit scores? How are they calculated?

I went to the 3 credit bureaus to check my scores, and paid a pretty penny for their nonsense. On Experian, my score was 720. On Transunion my score was 650. On Equifax, 630. I've been diligent about monitoring my credit bureau report, and all 3 bureaus are reporting - FINALLY - all the same trade lines, and have been for several months.

Does anyone know why this is? My "conspiracy theory" imagination is believing the Experian score is highest because I subscribe to a monitoring service and I can check my report and score as many times as want. I did belong to the other 2 as a subscriber, but cancelled because it was costing too much money for the same information. Now I'm wondering if I'm being punished with lower credit scores for cancelling their monitoring system.

Any information on how they report and how each bureau can be so different would be appreciated.

My name is Tom and i own a mortgage company. Before that however, I was a debt collector for 16 years.

The FICO,BEACON, AND EMPERICA scores are all pretty well based on the same thing, and all of them quite often dont make a lot of sense.

I have one fellow right now who has NEVER ONCE paid a debt. ALL OF HIS TRADELINES are charge offs. Not ONE current trade. They are all fairly old, but still - NOT ONE piece of good credit.

His mid score? Get this -its 586. Thats right.

My question is HOW IS HIS CREDIT SCORE NOT 310???

I have another borrower whose has no lates on his mortgage, has current credit cards and no charge offs , but has some medical debt reported......some of within the last year.

his score? 572 .....

Now can this make sense? WTF???

It goes to prove more and more the 'scoring system' that they use can only function if they actually have the gall to:

MONITOR AND RATE THE TRUE VALUE OF THE DEBT BEING REPORTED.

All kinds of jerk offs call themselves collection agencies and medical debt guys. They SPANK the debt on as 'new charge offs' for old or disputed debt. Even PHANTOM DEBT.

the scoring system just takes it as gospel truth and PLUNGES YOUR SCORE down to hell. Ive seen it a MILLION times , and a good 40% off all my applicants have some form of BS on their credit that has lowered their score.

I think the bureaus should do something about that for starters.....never mind the old 'better leave unused credit card tradelines open' routine.

My name is Tom and i own a mortgage company. Before that however, I was a debt collector for 16 years.

The FICO,BEACON, AND EMPERICA scores are all pretty well based on the same thing, and all of them quite often dont make a lot of sense.

I have one fellow right now who has NEVER ONCE paid a debt. ALL OF HIS TRADELINES are charge offs. Not ONE current trade. They are all fairly old, but still - NOT ONE piece of good credit.

His mid score? Get this -its 586. Thats right.

My question is HOW IS HIS CREDIT SCORE NOT 310???

I have another borrower whose has no lates on his mortgage, has current credit cards and no charge offs , but has some medical debt reported......some of within the last year.

his score? 572 .....

Now can this make sense? WTF???

It goes to prove more and more the 'scoring system' that they use can only function if they actually have the gall to:

MONITOR AND RATE THE TRUE VALUE OF THE DEBT BEING REPORTED.

All kinds of jerk offs call themselves collection agencies and medical debt guys. They SPANK the debt on as 'new charge offs' for old or disputed debt. Even PHANTOM DEBT.

the scoring system just takes it as gospel truth and PLUNGES YOUR SCORE down to hell. Ive seen it a MILLION times , and a good 40% off all my applicants have some form of BS on their credit that has lowered their score.

I think the bureaus should do something about that for starters.....never mind the old 'better leave unused credit card tradelines open' routine.

My name is Tom and i own a mortgage company. Before that however, I was a debt collector for 16 years.

The FICO,BEACON, AND EMPERICA scores are all pretty well based on the same thing, and all of them quite often dont make a lot of sense.

I have one fellow right now who has NEVER ONCE paid a debt. ALL OF HIS TRADELINES are charge offs. Not ONE current trade. They are all fairly old, but still - NOT ONE piece of good credit.

His mid score? Get this -its 586. Thats right.

My question is HOW IS HIS CREDIT SCORE NOT 310???

I have another borrower whose has no lates on his mortgage, has current credit cards and no charge offs , but has some medical debt reported......some of within the last year.

his score? 572 .....

Now can this make sense? WTF???

It goes to prove more and more the 'scoring system' that they use can only function if they actually have the gall to:

MONITOR AND RATE THE TRUE VALUE OF THE DEBT BEING REPORTED.

All kinds of jerk offs call themselves collection agencies and medical debt guys. They SPANK the debt on as 'new charge offs' for old or disputed debt. Even PHANTOM DEBT.

the scoring system just takes it as gospel truth and PLUNGES YOUR SCORE down to hell. Ive seen it a MILLION times , and a good 40% off all my applicants have some form of BS on their credit that has lowered their score.

I think the bureaus should do something about that for starters.....never mind the old 'better leave unused credit card tradelines open' routine.

My name is Tom and i own a mortgage company. Before that however, I was a debt collector for 16 years.

The FICO,BEACON, AND EMPERICA scores are all pretty well based on the same thing, and all of them quite often dont make a lot of sense.

I have one fellow right now who has NEVER ONCE paid a debt. ALL OF HIS TRADELINES are charge offs. Not ONE current trade. They are all fairly old, but still - NOT ONE piece of good credit.

His mid score? Get this -its 586. Thats right.

My question is HOW IS HIS CREDIT SCORE NOT 310???

I have another borrower whose has no lates on his mortgage, has current credit cards and no charge offs , but has some medical debt reported......some of within the last year.

his score? 572 .....

Now can this make sense? WTF???

It goes to prove more and more the 'scoring system' that they use can only function if they actually have the gall to:

MONITOR AND RATE THE TRUE VALUE OF THE DEBT BEING REPORTED.

All kinds of jerk offs call themselves collection agencies and medical debt guys. They SPANK the debt on as 'new charge offs' for old or disputed debt. Even PHANTOM DEBT.

the scoring system just takes it as gospel truth and PLUNGES YOUR SCORE down to hell. Ive seen it a MILLION times , and a good 40% off all my applicants have some form of BS on their credit that has lowered their score.

I think the bureaus should do something about that for starters.....never mind the old 'better leave unused credit card tradelines open' routine.

My bank recently changed its scoring system from FICO to the Transrisk system offered by TransUnion. I was in progress of applying for a mortgage and paid off two ancient collections that were still reporting. On Equifax, which uses FICO, there was no score change which was expected, on TUthere was a 30 point score drop on each. 60 total

Keep in mind that ths is the same action that FICO called a glitch in its scoring system and worked to correct, not only that but it reports that I have a new collection on my account, the neswest one is over four years old. Since the score already considered these collection accounts, why hit you with an additional 30 point drop which is the same as if a new collection is added to the account?

This model was developed soley to give lenders a reason to increase interest rates and thats what they pay for. There is nothing in it for the consumer. I finally cntact their media relations department and will let you know how they respond

First off the credit bureaus do NOT and I repeat the word NOT create your credit score nor do they make the judgement to extend you credit. The lender makes the judgement based on a score where your information was entered into a scoring model ( which BTW there are over 30 different scoring models on the market today). You want the facts go here: http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre24.htm

You want advice to fix/ improve your credit go here: http://www.nfcc.org

As the person stated earlier in this discussion, bankruptcy is the better option. I lost a job to India and have been living on 1/3rd of what I made as an engineer. Rather than declare bankruptcy I hacked away at the debt and have paid it all off. Granted I had some serious lates and I knew this would damage my score. However, what I did not realize was that paying off the debts as I have makes zero difference to the credit scoring algorithm. In reality, I wasted my time paying off the debts.

My wife had declared bankruptcy due to her previous marriage and had sterling credit shortly thereafter. I pay my bills and am told that my credit is ruined for life. So, my advice, screw the bill collectors and declare bankruptcy. This works for the rich and will work for the little guy too!

This is a topic that gets me furious everytime I even think of it. It seems that no matter what I do, I simply cannot win. I make all of my payments on time, never missed even one, yet my credit cards jack up my interest rate to a default or even higher, in one case, over 30 PERCENT! They supposedly can do this due to some fine print in the statement that came with my cards. Their reasoning is that my credit score dropped below a certain number when they ran it? WTF!!! I have always paid ALL of my bills ON TIME with no delinquincies. I was told I had high balances, I paid them off. Didnt help. I was told I had too many open accounts, I closed half of them, my score dropped even more.
This claim of being fair to consumers is BS! You have to twist someones arm just to see your OWN credit report. And another thing that irritates me is that my score has also dropped because of too many "official" inquiries. Over 75% of these inquiries are from companies I have NEVER even heard of i.e. a mortgage company in Oregon, when I live in FLORIDA and always have lived in Florida. I am paying crappy interest rates on my car and boat now because of all this. I was told by the agencies that inquiries CANNOT be removed, legitimate or not! And it keeps happening!

I am so beyond sick of this entire $$^%$#% up system. These days, you cant even get a job without the employer checking your credit. Do they think you are going to steal if you dont have a high enough score? How are you supposed to pay your bills on time if you cant even find a job because of the BS on your credit report? Luckily, I have a decent job, ironically, at a bank. Even just shopping for insurance for my car, they all checked my credit and charge me a higher premium because of it.

If there is some miracle solution to this fiasco, someone, please help. I am paying two to three times the interest rates of people who have bankruptcies on their record, and I cant keep it up.

and bad advice at the same time.

Closing any extra cards beyond one or two was good advice, but keeping at least one would have actually raised your score.

This depends on several factors. Your debt/income ratio and your balance/available limit makes a difference too.

Also the age of those cards make a difference. If they are less than a year established, they count against you. You are better off keeping your credit cards at 40-60% of your limit.

That will maximize your score. The two car payments more than likely count against you unless your debt to income is less than about 70%.

Everyone's situation is different, but the scoring criteria remain the same.

I wasn't screaming at you, but I have proven my abilities and have helped hundreds of people. I am good at this credit business. I am getting ready to write a book that the credit card companies will hate.

I could take one look at your report and raise your score 50-100 pts in 3-6 months. Guaranteed.

Good luck with it.

is because when you closed the 5 accounts, you lowered the "average length of credit" component that is used in the scoring algorithm. My guess is the 5 accounts you had were opened some ago. This is good.

Let's suppose each of the accounts you closed were 12 years old, and your car payments were 1 and 3 years old respectively, and your house payment was 10 years old. The average lenghth of credit is about 9 years. This is pretty strong. Now cancel the 5 accounts, the average becomes a little less than 5. This is really weak. 7 is considered adequate.

So you can see how your score could have tanked.

What Steve is saying is correct as well. 25 open accounts will kill you as well. However, over time, this will start to work in your favor as the accounts get older, it improves your average lenghth factor, which will eventually offset the number of open accounts.

That's why you might as well leave an account open, since you've already done the damage, and over time things will just improve.

You received very bad advice from the mortgage broker. Having several credit cards open for a long time but not used shows that you're responsible with credit, not up to some scheme. One of the score factors is "average age of accounts." If all your open accounts are relatively new, that looks bad. If you have no open credit cards at all now, that is bad.

Cards with a high balance, even if all payments are made on time, will kill your score. Keep balances under half of the credit limit if not lower. Ask creditors for higher credit limits, but don't actually use them.

Don't get credit cards (Capital One in particular) that don't report the limit. FICO thinks that those are maxed even though they have a very low balance. Capital One does this on purpose to lower people's scores so they can't get competetiors' cards.

A good mortgage broker (you'll have to find one, the one you have now isn't) should be able to get you a good rate by going to companies that have a real person review your credit report instead of just a computer looking at the score.

I do know what I am talking about. I have spoken to the Credit Bureaus and gotten the same response from each of them! Because I CLOSED my accounts they are no longer used to validate my credit score.

So, since you seem to know it all, tell me why an individual with a spotless credit report has a sudden drop of 100 points in their score after closing their credit card accounts - fully paid of course.

That is the only change. I have a house payment and 2 car payments. That's it. No other outstanding debt. Again, my credit is spotless. But, my score went from 740 to 620 for no reason, other than the CC fiasco. You tell me where on their web site I can find an explanation for that!

Plus Mr Mortgage Broker, it was my own Mortgage Broker that suggested I CANCEL the cards, since they could be viewed as an 'intent to charge thousands of dollars on my credit cards after buying my house' so I did what he suggested, just to 'insure I get the best rate possible'. (His words)

and, was I talking to you???

I was a mortgage broker for a few years, and as a subscriber to the 3 major credit bureaus, I got information from them that you cannot get.

I had "score cards" or quick reference sheets from each bureau explaining EXACTLY what makes up your score.

All factors and scoring criteria were listed.

And, in my personal case, I found that too many credit cards lowered my score over 100 points. I had a spotless payment history for over 14 years.

So, DAVE...You have absolutely no idea what you are talking about.

You can get SOME of this scoring information directly from the credit bureaus website! And from several other sources!

So, before you go off on someone who wasn't even talking to you, GET YOUR FACTS straight!

We had some financial problems about 6 years back which we dug our way out of. (My husband is Active Duty and we were stationed in England. That dollar to pound rate kicked our butts....) Anyway, we worked our way back out of this mess and have kept all our payments on time for the last 3 1/2 years and our credit cards low but our score is lower then my friends score who filed bankrupt 4 years ago. They dump all their debt and end up with excellent credit, we dig our way out trying to pay the bills we made and we get penalized....go figure...

That is NOT true. In my case, my wife and I have absolutely NO lates, NO bad credit, LOTS of paid off accounts and minimal open accounts. Recently after paying off our credit cards (about 5), we cancelled the accounts, cut up the cards, and threw them away. NOW, our credit DROPPED OVER 100 POINTS. Why?

Because, according to Trans Union and Equifax, they NO LONGER USE THE CREDIT CARD ACCOUNTS to figure our score since we CLOSED THE ACCOUNTS! WTF??? We have a perfect credit history, and because we do the right thing and eliminate our credit card debt, we are PENALIZED??

That is WRONG! Plain and simple. The OP is right, the banks and lending institutions only look at the score, not the report. The scoring models being used are COMPLETELY inaccurate and need to be re-vamped.

You have either too much credit available, or the total you owe as compared to the account balances is too high.

Payment history is only 1 small part of the overall scoring system.