Fair Isaac, the company behind FICO credit scores, is updating the way it calculates consumers’ creditworthiness—which could result in lower scores by lisettevoytko
, which first reported the news, FICO’s new scores will be added to the company’s stable of scoring models.
The changes will more harshly grade consumers with growing amounts of debt, missed loan payments and, for the first time, take into account unsecured personal loans, which could cause scores to drop. Under the new scoring models, consumers with scores above 680 who are on top of loan payments could see their scores increase, while those with scores below 600 are more likely to see drops.
One of FICO’s new models, the 10 T, will judge consumers’ debt levels over the past two years, likely calculating lower scores for consumers who carry credit card debt from month to month or get close to maxing out their spending limits. Overall, lenders using the new FICO scores will see a wider gap between consumers viewed as more creditworthy and those who are not,Lenders will get to choose, however, whether to adopt the new FICO scores or a competitor like VantageScore.
United States Latest News, United States Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Average FICO score hits record high—here's the average credit score in every stateThe average FICO score hit a record high of 703 in 2019. CNBC Select breaks down the average credit score in every state according to the 2019 Experian Consumer Credit Review.
Read more »
WSJ News Exclusive | FICO Changes Could Lower Your Credit ScoreChanges in how the most widely used credit score in the U.S. is tallied will likely make it harder for many Americans to get loans.
Read more »
ADHD at School Checklists, Sample Letters, Daily Report Cards and MoreA template your child can fill out to let their teacher know about themselves. A handout about what every teacher should know about ADHD. A handout with solutions for common executive function challenges. And more.
Read more »
Here's what every major analyst had to say about Netflix's fourth-quarter earnings reportWall Street analysts say Netflix's fourth-quarter earnings report was solid but remained concerned about U.S. subscriber growth.
Read more »
Christian Nationalists Are Drafting Legislation for State Republicans: ReportIn the 2018 legislative session, state lawmakers proposed 74 bills similar to Project Blitz draft legislation, ranging from measures designed to restrict same-sex marriage to allowing adoption agencies to deny placements because of religion
Read more »