Yesterday when I was watching Carmen Wong Ulrich aka the young Suze Orman(At least I think so)show on CNBC "On the Money,She said that the three credit bureaus-Experian,Transunion and Equifax have formed a new credit scoring system. It's called Vantage Score.
Your Vantage Score could look different from your FICO Score. It uses the same underlying data about your debts as the FICO score you already know. Experian,Equifax and Transunion are private companies that each track your accounts,balance and payment habits. A credit score simply assigns a weight to those factors to produce an indicator of how much risk you pose as a borrower. Fair Isaac Formula for scoring is the one lenders like best. The lender pays the credit bureau for the score,and the bureau pays FICO for using its formula.
Now it looks like the three credit bureaus want to cut Fair Isaac out of the picture to avoid paying them. The three bureaus actually tried this before but they didn't succeed. They are hoping for a different result this time around with the Vantage Score.
While the FICO scale runs from 300 to 850,the Vantage Score range is more "intuitive" because it breaks down like an school report card.
- 901-990 equals "A" credit.
- 801-900 equals "B" credit.
- 701-800 equals "C" credit.
- 601-700 equals "D" credit.
- 501-600 equals "F" credit.
This could be what we need. I know a lot of people are not so crazy about the FICO Score. People think by the three bureaus forming Vantage Point,it will force Fair Isaac to be more more flexible with its prices. And by the way,you still have to pay for it. So make sure you only pay for just one of the scores and not both.
For more information on the New Credit Score by Experian,Transunion and Equifax,click on this link On The Money: The New Credit Score In Town - On the Money - Credit ...
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