FICO V.  FAKO: Limitations of Free Credit Scores If There Truly Is

FICO V.  FAKO: If you have ever purchased your credit score from multiple sources, you must have probably noticed that there is a wide discrepancy in numbers. So you’ll probably be wondering what is your “real” credit score and how can you be sure which one is real.

FICO V.  FAKO: Limitations of Free Credit Scores If There Truly Is

Understand credit scores

Understand that credit scores are all real, they just represent different things. This is because they are all estimates.

Most people however consider the FICO credit score as being the “real” credit score. This is owing to the fact that the majority of mortgage lenders. And other credit sources make use of this score. In evaluating a consumer’s credit risk. FICO score is created by proprietary. Software from Fair Isaac and Company (FICO) and is currently produced by MyFICO.com. Which is the consumer division of FICO.

FICO gets information from the credit reporting agencies. (primarily Experian, Equifax, and TransUnion) and uses its own formula in producing the FICO score. Experian, Equifax, and TransUnion on. The other hand use other rating systems in evaluating the same information. And produce their own credit scores.

Now, understand that the score you get by purchasing information. Via one of these agencies is not a FICO score. Instead, they have their own competing system called VantageScore. The credit scores produced by the reporting agencies are. Generally used for consumer reference purposes much as a relative check on credit. Thus, they are not likely to be the ones used by lenders. Although they are based on the same information (which brings about the name “FAKO”)

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The only sure way of knowing that you are getting a true FICO score. Is to obtain it through myFICO.com. For anyone else who claims to have a FICO score. It is best you investigate the version of FICO that they use. This is because FICO is a software algorithm that is constantly being updated (currently at version 8), you could legitimately be getting a “FICO” score that. Does not match the one you get from myFICO.com because an older software version was used.

Is there a truly free credit score?

At the end of the day, there is actually no one true credit score, (not even the FICO score) even though the FICO score comes closet. This is because your potential lender may be using data. From a different credit reporting agency or a modified FICO scoring version or not even use the FICO score at all.

Thus you have to avoid being like most consumers who learn too late that there is no such thing as a truly free credit score. Thus avoid getting enticed by promises of better credit scores and use your credit card for a credit monitoring service.

Sooner or later, you’ll find out that these scores are not better or different from the ones that come free with apps or websites. Then, if you fail to cancel your trial before the trial period runs out, the monthly fees start. If you try to cancel once that starts, is more difficult than before the trial ends.

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Not all free credit scores created equal

Even though it may appear that both scoring models use the same criteria in generating credit scores, they have different purposes and lenders do not use the same ways. This can make getting and using free credit scores to apply for credit quite tricky.

Now because they are all vying for the most subscribers, all free credit scores offer limited but useful information from your credit reports about what’s affecting your credit score. However, these scores telling you and are the ones that most creditors use.

Where to Get Free FICO (not FAKO) Scores, FICO V.  FAKO

FICO does tell consumers who its partners are, as well as where they can get FICO scores through what they call Open Access.

According to MyFICO, “FICO works with over 130 financial institutions in order to give their customers absolutely free access to the same FICO® scores they are using to manage credit accounts.

Thus if your bank, credit card issuer, auto lender or mortgage servicer participates in FICO® Score Open Access, you can see your FICO® Scores, along with the top factors affecting your scores, for free”.

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