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Sarah, Other/Just Looking in Racine, WI

Credit score confusion! I recently requested my credit score on myfico.com (about a week ago) and found it was 507. I just requested my credit scores

Asked by Sarah, Racine, WI Thu Jan 7, 2010

from the TransUnion, Experian, and Eqifax on truecredit.com and got, 593, 603, and 579. Why is the fico score (507) so different from the others (593,603, 579)? Which one do I go by? If someone could please explain this to me I would really appreciate it! Thanks in advance!!

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We see many credit reports with low credit scores (anything less than 620), and often many scores in the 500's. This is BAD credit. If you are one of the folks affected by this terrible economy, you have a low credit score and you have a dream of buying a home, here's some simple advice for you.


It is unlikely you could be approved for mortgage financing with that credit score at this time.

Beware of any mortgage professionals promising you an approval with such a low score. Wait on buying a home. I recommend you take the time to resolve your credit issues.

First, settle any outstanding debt. If you owe money on collection accounts, charge-offs and/or judgments, make payment arrangements and get these accounts paid promptly.

Next, begin rebuilding your credit. If you have current accounts with good payment histories, or even some previous late-payment-blemishes, make sure you continue to pay those accounts on time. If you do not have any existing credit accounts then you'll need to establish several in order to create a viable credit history.

I have found that CONSUMER ACTION is an excellent resource for objective advice on all things credit related. You'll find free and sincere advice on everything from settling collection accounts to rebuilding credit to building credit from scratch on their website. http://consumer-action.org/

Beware of anyone offering to "repair" your credit! The Federal Trade Commission issued a stern warning last year that such offers are scams. Find more from the FTC HERE. http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre13.shtm


The best way to buy a home is to have a decent credit history combined with sufficient Income and Assets for a home purchase.

The best way to have a decent credit history is to settle negative outstanding obligations and pay all your bills on time for at least two years.


Trevor Curran
NMLS #40140
1 vote Thank Flag Link Sun Apr 29, 2012
Sarah, vantage scores use a different formula than FICO to calculate your score. They put more emphasis on some areas where FICO won't and vice versa.

The reason why your score is higher with vantage is because where FICO scores go from 300-850, vantage goes from 500-900.

As far as I know, all banks use FICO.

As I said earlier, the body of your report-which accounts are delinquent, late payments, balances due, etc. should be the same.

I hope this helps.

Good luck.
0 votes Thank Flag Link Thu Jan 7, 2010
Ok, I found out why the scores are different. The first score (507) is a FICO score and the other 3 scores are Vantage scores. Do any lenders use Vantage scores? If so, how do they compare to FICO scores? In other words, what are my chances of getting a mortgage?
0 votes Thank Flag Link Thu Jan 7, 2010
Sarah, although it shouldn't be this way, for some reason the credit report you get yourself online isn't the same as the commercial grade credit report a lending institution.

The body of the report might be the same, but if you want to know the score a bank would go by then you need to have your credit report pulled by a lender.

Hope this was helpful. Good luck.
0 votes Thank Flag Link Thu Jan 7, 2010
Sarah,

When applying for a mortgage loan they usually use the middle score. You should request copies of your credit from each of the credit agencies. Your credit score can change due to opening new credit lines, charging close to your credit limits and also closing accts. Another thing to remember is if you have a mortgage doing a mortgage modification or shortsale will also effect your credit score by 100 points or more. So watch out for all the department stores trying to give you discounts to open new credit cards. What I have heard from several money advisors is to pay off your credit card etc but to leave the lines open. Remember the most important thing is to pay everything on time.
Web Reference: http://tammydurbin.com
0 votes Thank Flag Link Thu Jan 7, 2010
Hi Sarah,

There are many scoring systems in use but the original credit scoring system was developed by Fair Isaac and Company, and is used to establish a borrower's score as it relates to their likelihood of paying back on a mortgage or other loan. FICO Scores are calculated from a lot of different credit data in your credit report. The calculation is 35% Payment history, 30% amounts owed, 15% length of credit history, 10% new credit, and 10% types of credit used. Each of the three main credit reporting agencies, Equifax, Experian and Trans Union use variations of the FICO score to meet their specific requirements. Lenders will use the FICO score from all three credit reporting agencies and may use the middle score to base their decision upon. Hope that helps.

Ally Gillette
Long and Foster
0 votes Thank Flag Link Thu Jan 7, 2010
Some debts are reported to one company, some to all 3, etc. and if you request a copy of your credit report from all 3 companies, you'll see who has what reported--thus, the different score-- the midlle one is often chosen as it's usually the best average of the 3 combined.

Anna
0 votes Thank Flag Link Thu Jan 7, 2010
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