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Fitch Becomes First Rating Agency to Accept Mortgage Loans Based on VantageScore, Posted by Robert Paisola

2008-09-23T02:55:00.000-06:00

Fitch Becomes First Rating Agency to Accept Mortgage Loans Based on VantageScore

Last update: 10:08 a.m. EDT Sept. 22, 2008

NEW YORK, Sep 22, 2008 (BUSINESS WIRE) -- Fitch Ratings announced today that it is the first rating agency with the capability to evaluate and assign ratings to mortgage loans based on VantageScore, the generic credit scoring model jointly developed by the three national credit reporting companies (Equifax, Experian, and TransUnion).
According to testing done by Fitch, VantageScore provides highly predictive evaluations of consumer creditworthiness. The three national credit reporting companies apply an identical algorithm to data, creating a more consistent score. The model can also score consumers with limited credit histories.
'The mortgage crisis has not only shown that a multitude of factors influence the performance of high risk loans, but has also underscored the need for an improved generic consumer scoring model against which mortgage lenders can more reliably make their loans,' said Group Managing Director and U.S. RMBS group head Huxley Somerville. 'Built using data that includes the dramatic rise in consumer indebtedness in recent years and regularly revalidated to ensure the model's continued predictiveness, VantageScore has shown to be more accurate than FICO because it excludes the use of authorized trade lines.'
Fitch has fully incorporated VantageScore into ResiLogic 2.1, its flagship quantitative model that provides credit risk analysis at the individual loan and pool level for residential mortgage loans. ResiLogic was recently updated to include national economic and regional performance factors, loan seasoning, and adjustments for high risk loan underwriting and mortgage insurance.
About Fitch Ratings:
Fitch Ratings is a global rating agency dedicated to providing the world's markets with independent, timely and prospective credit opinions. Fitch Ratings is headquartered in New York and London and is part of the Fitch Group, a majority-owned subsidiary of Fimalac, S.A., headquartered in Paris, France. For additional information, visit www.fitchratings.com or www.fimalac.com.
About VantageScore Solutions:
Stamford,CT-based VantageScore Solutions, LLC ( www.vantagescore.com) is an independently managed company that holds the intellectual property rights to VantageScore--a new generic scoring model introduced in March 2006. Created by America's three major credit reporting companies (CRCs) - Equifax, Experian and TransUnion--VantageScore's highly predictive model uses an innovative, patent-pending scoring methodology to provide lenders with a consistent interpretation of consumer credit files across all three major credit reporting companies (CRCs) and the ability to score more people.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.
SOURCE: Fitch Ratings
Fitch Ratings, New York
Huxley Somerville, 212-908-0381
or
Media Relations:
Sandro Scenga, 212-908-0278

Copyright Business Wire 2008

Insurers' use of credit scoring is here to stay, Posted by Robert Paisola

2008-04-20T15:38:00.001-06:00

Q I just received my FICO score and VantageScore ranking. My FICO score was 5 points less than my VantageScore ranking, yet FICO gave me a "good" rating and Vantage gave a "nonprime" grade D scoring. My vehicle insurance went up because of this score. Is there any way to dispute this?

A Don't I wish you could dispute your insurer's decision!

My insurer did the same thing to me while insisting I was still saving more money on my insurance than if the company didn't use scoring. Go figure.

What's really interesting about your situation is the big difference in how FICO and VantageScore rated your scores.

First, let me talk about my actuarial friends.

Insurers have the right in most states to view your credit history and include what is found there in their calculations of your personal risk.

Why? Well, insurers say — and our fearless state representatives agree — there is a correlation between how a person handles credit and the likelihood of filing an insurance claim.

So to help everyone manage the difficult situation of who gets charged what rates, or gets coverage at all, insurers rely on a scientific model.

The bottom line of the situation is that insurance credit scoring is here to stay.
You can ask the insurer's customer service why your rates went up, but you'd probably have more luck asking my cat Stinky for answers. Each company has its own scoring models and considers them to be trade secrets.

However, you can get a version of your generic insurance score from TrueCredit. You will receive an auto and homeowner's coverage score along with advice for improving your score. Insurers may not look at the information contained in your credit reports and scores in the same way that a potential lender would. For example, an insurer may be more interested in your payment history than in how much you owe.

Your FICO and VantageScore credit scores are based on the information contained in your credit reports at each of the three major credit bureaus — Experian, Equifax and TransUnion.

Because each bureau has different data in its files about you, you will have a different score depending on which type of data they use.

Although you cannot dispute your scores, you can check your credit reports to assure that the information used to calculate those scores is correct. If you find inaccurate or out-of-date information, you should file a dispute with the bureau that reported it.

VantageScore is a relative newcomer to the credit-scoring industry. It was developed by the bureaus, and they claim the VantageScore ranking is more up-to-date than a FICO score. Different math and weightings are used to figure your score, and each has its own range of scores.

FICO scores go from 350 to 850, while VantageScores range from 501 to 990 and also include a letter grade.

Once you have your credit reports in the best shape possible, your only other alternative for saving money on your insurance premiums is to shop around for different insurance carriers.

Because insurers each use their own scoring systems, you could have a much better score with carrier A than you do with carrier B, and your premium will reflect that.

FICO 08: The New FICO Credit Score Model, posted by Robert Paisola

2008-03-07T06:56:00.000-07:00

FICO 08: The New FICO Credit Score Model
Fair Isaac Tweaks the FICO Formula
Published on: Friday, March 07, 2008
Written by: Brad Zimmerman

It’s been almost a decade since the Fair Isaac Corporation changed the formula to their popular and widely used FICO credit score model, and apparently a decade is quite long enough. Fair Isaac is preparing to roll out its new credit scoring formula—aptly titled FICO 08—this spring, an accelerated date, in order to help lenders improve their risk management in the wake of rising loan defaults.

Fair Isaac predicts the new formula will reduce default rates on consumer credit between 5 percent and 15 percent, according to the Wall Street Journal. Lenders have been increasingly needy of a more accurate measurement of credit risk as defaults continue to build up because of subprime mortgages and falling housing prices.

“Higher-risk borrowers may find it tougher to get credit, while those with less-risky profiles—though they may have gotten approved for credit accounts in the past—will start to get better deals from lenders,” according to the Wall Street Journal.

The FICO scoring system, which is used by 90 percent of the country’s 100 largest banks, won’t be tampering with the scoring range of 350 to 800, or with things such as timely payments, length of credit history and amount of debt, among other things. There are some changes investors should be aware of, however.

Most notably, FICO 08 will eliminate authorized users; see our previous article Credit Boom Turned Credit Bust for more information. While the old system would allow spouses and children of primary card-holders to become authorized users and build their own credit histories, lenders felt the practice undermined their attempts to contain credit risk, according to Mortgage News Daily.

The move was largely in response to the creation of credit-repair websites that would allow consumers with bad credit to become authorized users on the account of a stranger with a good credit history. It will, however, hurt those spouses and children of card-holders who legitimately used the practice to build their own credit.

Additionally, FICO 08 will give more credit points to consumers who maintain multiple lines of credit, such as a credit card, auto loan and home loan, while penalizing more heavily those people who use a lot of their available credit, according to the Wall Street Journal.

The new system will also go easier on consumers with an occasional slip-up in payment and come down much harder on those with multiple credit infractions. The new system is intended to be more precise in determining good and bad risk borrowers, especially among subprime borrowers and those seeking or just establishing credit.

Although it seems like the FICO 08 scoring system will be much tougher, the average credit-holder may be pleasantly surprised.

“Overall, more consumers will see their FICO scores go up slightly than will see their scores drop,” Tom Quinn, vice president of global scoring solutions for Fair Isaac, said in a press release.

Investors should take note of Fair Isaac’s changes in the scoring system and expect to see it go into effect in the coming months as the major credit reporting agencies adopt it. Fair Isaac has already given FICO 08 to Experian and TransUnion plans to implement the new system sometime in the second quarter of this year.

The third major credit reporting agency, Equifax, is in the midst of a lawsuit with Fair Isaac about competition from a new system, VantageScore, and plans not to move forward with FICO 08 at this point in time, according to the Wall Street Journal. Fair Isaac maintains that it will distribute the formula to all three agencies.

Free Lessons On The Secret Today! Posted By Robert Paisola

2008-02-06T02:07:00.001-07:00

Knowing the score can reduce finance charges

2007-08-03T21:12:00.000-06:00

Knowing the score can reduce finance charges

By TERESA McUSIC
Special to the Star-Telegram
Take this quick true/false quiz.
Your credit score is influenced by:

A. Your income

B. Your age

C. Your state

D. Your ethnicity

E. Your education

If you answered true to any of these, you don't know what a credit score really is.

Low scores mean higher interest rates on everything from car loans to mortgages to credit cards. Low scores can also mean higher insurance rates, an inability to get services like cellphones, and difficulty getting a job or a place to live.

Your credit score has enormous influence on your daily life, yet a recent survey by the Consumer Federation of America and Washington Mutual reveals that most Americans still don't understand it.

"I'm surprised so many people know so little about their credit score," said Stephen Brobeck, executive director of CFA. "I expected to see an improvement of knowledge over the last couple of years."

Yet an amazing 74 percent of people surveyed thought income influenced their score. More than one-third said age, education and state of residence had some effect. Nearly 20 percent thought that ethnicity had an impact.

Wrong. Wrong. Wrong.

Let's all go back to Credit Scores 101.

Credit scores serve one purpose: They indicate your risk of not paying back what you owe.

FICO scores -- named for their creator, Fair Isaac & Co. -- range from 300 to 850. The higher your score, the better off you are with lenders, insurers, employers and landlords. Most scores fall between 600 and 700, according to Consumers Union, with higher-cost lending, called subprime lending, starting with a score of 620.

How much can that difference in cost be? FICO estimates that someone with a credit score between 760 and 850 will pay $466 less a month in interest on a 30-year, $200,000 mortgage in Texas than someone with a score of 500 to 579.

Washington Mutual estimates that $20 billion would be saved in lower credit-card charges if Americans raised their credit scores an average of 30 points.

The scores are generally made up of five different criteria. Fair Isaac breaks it down like this:

Payment history, 35 percent. This means just what it says. A long history of making payments on time leads to a better score. One or two late payments won't usually hurt, but missed payments, bankruptcies, foreclosures and liens can have a serious effect on your score.

Amounts owed, 30 percent. Owing money in itself does not trigger a low score. Your score is hurt if you are close to maxing out a credit card or if the amount you owe has jumped recently.

Length of credit history, 15 percent. It's possible to have a short history and a high score, but longer is better.

Type of credit in use, 10 percent. This portion looks at the mix of your credit, from mortgages and installment loans to credit cards and retail accounts. It's not a key factor unless there's not much other information about you.

New credit, 10 percent. Timing again plays into this part of the score, in that opening up several lines of credit in a short period can lower your score. Multiple card requests can also lower your score.

This year, the three credit bureaus introduced a new scoring system called VantageScore. Its range is 501 to 990 with accompanying letter grades from A to F.

Adding another score and range to the market complicates things for consumers, Brobeck said. But as long as you know the range, either score will give you an idea where you stand with lenders, insurers and others you want to do business with.

"If you don't know what a good score is, you can't understand if you have a good score," Brobeck said.

Getting your score generally costs about $14, although the new VantageScore is selling on Experian's Web site for $5.95.

For three years, Washington Mutual has given its customers free access to their credit scores online, said Alan Elias, senior vice president at the S&L.

"We have to pull the scores every month anyway to monitor them," he said. "And our customers can use it as a way to monitor identity theft."

Remember, credit scores can't generally be repaired overnight. But for most of us, working on some of our credit habits for six months can make a big difference.

Bottom line: if you're planning next year to buy a house or car, sign up for a credit card, cellphone or electric plan, rent an apartment or go to a job interview -- check out your score.

What's in your report?

Check your three credit reports at no cost at www.annualcreditreport.com, call 877-322-8228 or request a form at the Web site and mail it to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. You will need to give your Social Security number. The report does not include a credit score.

Source: Consumer Federation of America

HOW YOUR CREDIT SCORE AFFECTS YOU

A good credit score can save you thousands of dollars, particularly when you're borrowing money to buy a house. Here are several ranges of scores and the monthly payment on a $150,000, 30-year mortgage associated with them:

700-759: Rate: 6.52% Cost: $950

680-699: Rate: 6.7% Cost:$968

660-679: Rate: 6.91% Cost: $989

640-659: Rate: 7.34% Cost: $1,033

620-639: Rate: 7.89% Cost: $1,089

Average U.S. credit score: 678

Source: Bankrate.com

Boosting your score

There's no magic to raising your credit score. Here are the basics:

Pay bills consistently and on time.

Don't max out credit cards or other revolving credit.

Pay off debt rather than moving it around.

Don't open new accounts often.

Source: Consumer Federation of America

For Rent: Your Credit Score

2007-06-06T00:05:00.000-06:00

For Rent: Your Credit Score
Loophole in FICO Enrages Lenders

By Martin H. BosworthConsumerAffairs.Com

June 5, 2007

Plastic Prison • Credit Tips And Tricks• Get Control of What You Owe• No Easy Way Out Of Credit Card Debt• Penalty Fees, Interest Rate Hikes, and Misleading Contracts Await Credit Card Shoppers• "Convenience Checks" Carry a Heavy Price Tag• New Forms of Credit Scoring• Understanding Credit• Credit Bureaus: Who You're Dealing With• Reading Your Credit Report• Credit Scoring: The Fickleness of FICO• Credit Knowledge: A Long, Hard, Struggle---News• For Rent: Your Credit Score• Fed Proposes Tighter Controls On Credit Card Rates• Senate Bill Would Curb Abusive Credit Card Practices• Senate Panel Slams Abusive Credit Card Practices• Congress Targets Credit Card Companies For Reform• Report Finds High Debit Card Overdraft Fees• Bank, ATM Fees Continue To Rise• Credit Card Fees Rise, Disclosure Statements Inadequate• Free Credit Reports Mark First Anniversary• Credit Card Debt Sinking Many Older Consumers• Experian Launches New Credit Score; Critics Unimpressed• Credit Cards Target Students• Credit Card Companies Fear "Perfect Storm"• Credit Bureaus Introduce New Scoring System• More Banks Using Universal Default to Hike Interest Rates

The all-important three-digit number known as your credit score has become the central pivot on which the financial industry moves.

Borrowers are repeatedly told to demonstrate good financial behavior not just for its own sake, but to ensure that their credit score stays high enough to receive approval from lenders. And a score that doesn't meet with lenders' approval can keep otherwise responsible borrowers from getting a home or car loan for years.

So it should come as no surprise that companies like InstantCreditBuilders.com (ICB) and Addatradeline.com have devised a way to game the system -- in this case, by paying people with high credit scores to let low scorers "piggyback" on their ratings and receive boosts to their own scores as a result.

The new trick takes advantage of a loophole in the credit system. People who have little or no credit histories, such as college students, can be added as an "authorized user" to credit cards that are ultimately paid for by Mom and Dad.

In this case, the "authorized user" with good credit is paid several hundred dollars to "rent" their credit score out to someone else, with the agency taking their cut from the potential piggybacker.

Lenders Object

Although the Federal Trade Commission has been taking a wait-and-see approach to the issue, the financial and mortgage industries are already on the warpath.

The National Association of Mortgage Brokers (NAMB) is planning to release a statement opposing the practice. Mortgage lenders say the practice undermines the trust lenders place in the FICO score, which is by far the most widely-used scoring system for new loan approvals.
"We have become so dependent on FICO scoring that we rely on it almost to the point that FICO is the decisionmaking process," Bremer Mortgage president Jim Miley told the Minneapolis Star-Tribune. "If we can't get assurances that FICO scores are accurate, then we will definitely go back to manual underwriting of loans, a time-consuming and expensive process."

Unforeseen Consequences

Fair Isaac, creators of the FICO score, has said that it will close the "authorized user" loophole in its credit scoring model to protect against "piggybacking." John Ulzheimer of Credit.com says that the move is going to "screw consumers royally."

"A lot of people are going to get penalized for something a few bad apples did," Ulzheimer said in an interview with ConsumerAffairs.Com. "The value of any authorized user on a credit card is now totally lost."

Ulzheimer said that anyone who has built a credit history as an additional user on a card, ranging from college students to married couples and divorcees, will have to "rush out" and open up new credit accounts to rebuild or maintain their scores and credit histories.

"It won't be as big a rush as people filing bankruptcy before the new laws took effect,"
Ulzheimer said, "But you'll see it happen."

Ulzheimer, who formerly worked at both Fair Isaac and Equifax, said companies like ICB are liable for enforcement under the Credit Repair Organizations Act (CROA), which mandates the rules that so-called "credit repair organizations" work under. "The minute they take money in advance, they're liable under CROA," he said. "This is a case of merchants ripping off businesses, and some consumers ripping off lenders."

Bad Data

FICO became dominant largely because it streamlined the formerly cumbersome and detailed process of lending down to a simple number.

Whereas local credit bureaus and mortgage lenders would previously look at a person's entire financial history and make calls based on individual judgment, the modern system relies almost totally on the proprietary algorithm developed by Fair Isaac, and based on information in credit reports that is very often inaccurate.

The ease with which credit could be approved led to an explosion of availability of lending to people who would not ordinarily have qualified, but the mania to approve credit and sell reports and scores to lenders also led to constant errors and mistakes in reports that are very difficult to correct.

Now the housing market is in the doldrums, thanks to subprime loans going into default and foreclosure accross the country. Even the Federal Reserve is reconsidering the easy access to credit that consumers have come to take for granted.

And the closing of the "authorized user" loophole won't just make building credit tougher for consumers -- it's exposed a vulnerability in the FICO score that has competitors like the credit bureau-backed VantageScore ready to pounce.

John Ulzheimer had previously criticized the new score, which is sold right from the three bureaus, as "an effort to confuse consumers and unsophisticated lenders."

Now, he said, "I wouldn't be surprised if there was an all-hands meeting at VantageScore Solutions to discuss what to do" about the loophole in the FICO score. "They're licking their chops."

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Highs & lows for consumer in search of his credit score

2007-06-04T22:36:00.000-06:00

BY ASA AARONSDAILY NEWS COLUMNIST
Posted Monday, June 4th 2007, 4:00 AM
When Mel Larson requested his free annual credit report from a major credit reporting agency, he also ordered his credit score. "There was a $5 charge, but I felt it was a good idea since the number is important," he explained.
But he wasn't happy with what he got. "I received something called a VantageScore, not the FICO score I expected," he said. "My score was 898, well over the top FICO score.
Can a VantageScore be translated to a FICO score?"
Not exactly. Credit scores are the three-digit numbers that lenders use to assess the credit risk of a potential borrower.
Fair Isaac's Classic FICO score is the most often used credit score in consumer lending and mortgage lending. FICO scores range from 300 to 850.
Although FICO scores remain dominant, several alternatives have developed within the past few years.
In March last year, the nation's three leading consumer credit reporting companies - Equifax, Experian and TransUnion - jointly launched their own proprietary credit scoring system, VantageScore.
When you order your credit report fromExperian or TransUnion, you receive a VantageScore. Equifax, however, still provides FICO scores.
If you want to get a FICO score based on your Experian or TransUnion credit report, you have the option ofordering it from Fair Isaac (www.myfico.com).
Otherwise, you can only roughly compare your FICO score and VantageScore.
VantageScores range from 501 to 990, and approximate the letter-grade system used in most schools. That means a score of 901 to 990 is an A, while a score of 801 to 900 is a B, 701 to 800 is a C, 601 to 700 is a D and 501 to 600 is an F.
If you have a FICO score of more than 730, then you're in the solid B range. If it's 770 or more, you get an A. FICO scores of 680 to 729 are in the C range, while scores of 620 to 679 are Ds. Anything lower than 620 is an F.
Asa Aarons is a consumer reporter whoappears at 5:30 p.m. weekdays on WNBC-TV, Channel 4. His special Daily News column appears Mondays, Tuesdays, Thursdays and Fridays. Send your questions to Ask Asa, P.O. Box 3310, NewYork, N.Y. 10116 or e-mail him (AskAsa@gmail.com). Questions can be answered only through this column.End Content Columns -->

VantageScore Solutions Names Michael Dunn Vice President of Strategic Planning and Communications.

2007-05-25T23:57:00.000-06:00

STAMFORD, Conn. -- VantageScore Solutions, LLC, an intellectual property company whose VantageScore consumer scoring model has unparalleled predictiveness and can be uniformly applied to credit data from the three national credit reporting companies, announced today the appointment of Michael J. Dunn as the company's vice president of strategic planning and communications.

Mr. Dunn, 44, is responsible for leading the design, execution, and integration of myriad strategic planning and communications initiatives, such as advertising, branding, public relations, and trade association and regulatory community outreach. He reports directly to Barrett Burns, VantageScore Solutions' president and CEO.

"Mike's considerable brand management experience, general business acumen, and financial services expertise make him the ideal candidate to assume the mantle for overseeing VantageScore Solutions' strategic planning and communications function," said Mr. Burns. "We are delighted to have someone of his caliber on board as we continue to build on the positive 'buzz' in the industry for VantageScore."

Prior to his new position, Mr. Dunn most recently served as vice president of marketing at Webster Bank, a 177-branch retail bank based in Waterbury, Connecticut, where he was responsible for brand marketing strategy, execution, and performance measurement. During his tenure, Webster Bank enjoyed the strongest consumer awareness levels in its 71-year history for its brand in the bank's core Connecticut marketplace.

Earlier in his career, Mr. Dunn was a managing supervisor at Mintz & Hoke Communications Group, one of New England's largest advertising and public relations firms. He also served as vice president of marketing at Intergis, a B2B software development firm, and held several positions of escalating authority at communications firm Mason & Madison (now Mason, Inc.), where he created an independent e-business unit that helped clients formulate online strategies.
Mr. Dunn earned an undergraduate degree in communications with an emphasis in advertising from Ithaca College. He is the recipient of the marketing industry's prestigious Silver EFFIE Award for his contributions to the Vermont Lottery marketing campaign.

About VantageScore Solutions

Stamford, CT-based VantageScore Solutions, LLC was founded in March 2006 as an independently managed joint venture between the country's three national consumer credit reporting companies -- Equifax, Experian, and TransUnion -- to develop a universal, highly predictive, and consistent credit scoring system for the consumer credit markets. The resulting VantageScore service is independently marketed and sold separately through the three credit reporting companies via licensing agreements with VantageScore Solutions. For more information, please visit www.VantageScore.com.

Overhaul of FICO is coming

2007-05-20T15:42:00.000-06:00

Overhaul of FICO is coming

Kathleen Pender

Sunday, May 20, 2007

Fair Isaac said last week that it will introduce a more powerful credit-scoring system in September, but said it's not a response to criticism that the company's widely used FICO scores did a less-than-stellar job predicting defaults as the mortgage market grew more exotic.

The Minneapolis company said the new version will increase "predictive strength by 5 to 15 percent," especially for new accounts, subprime borrowers and borrowers with thin credit bureau files.

While it's promising big improvements for lenders, the company says the new system will have little impact on consumers.

"Some consumers' scores will go up slightly, some will go down slightly," says Fair Isaac spokesman Craig Watts.

The company would not explain what would cause a score to change, which is a shame considering the growing impact credit scores have on our lives. Lenders use credit scores to make or deny loans and set terms and rates. They are also being used, where allowed, by insurance companies, landlords, employers and utilities.

Credit scoring applies a formula to the information in your credit file and comes up with a number that predicts how likely you are to default on a loan.

Credit scores have performed so well that lenders have placed growing faith in them, perhaps too much. As long as borrowers had decent credit scores, many lenders were willing to lend them up to 100 percent of a home's value and let them make no principal and partial interest payments for a number of years. Many let customers state their income without documenting it.
Some critics say FICO scores did not perform as well as expected in this Wild West environment.

In a December conference call, HSBC finance chief Douglas Flint said that in 2005 and 2006, a "considerable amount of activity ... moved away from more-traditional products to affordability products" such as adjustable-rate mortgages, stated income loans and option ARMs. These products let people afford bigger mortgages with smaller monthly payments.

"What is now clear is that FICO scores are less effective or ineffective in circumstances where the ability to meet payments is beneficially enhanced by virtue of the fact that the payment obligations have been reduced because of very low interest rates. In other words, the FICO scores' predictive ability, because people weren't missing payments, were recording higher creditworthiness than might have been the case if they had had to make payments at more normalized interest rates, or without the benefit of affordability elements," he said.

Fitch Ratings, which rates mortgage-backed securities, says that as lenders added more layers of risk to a loan, the borrower's FICO score became less predictive.

For mortgages issued in 2003, before lenders abandoned common sense, borrowers who defaulted had significantly lower scores than those who didn't, says Glenn Costello, a Fitch managing director.

Borrowers who became 90 or more days delinquent had an average FICO score of 589 compared with an average score of 620 for those who never paid that late -- a difference of 31 points.

For loans made in 2006, that margin had shrunk to only 10 points. Borrowers who became seriously delinquent had an average FICO score of 615 compared with 625 for those who didn't.
"The loans that are defaulting now have higher FICO scores" than in the past, Costello says.

He adds that FICO scores still do a good job predicting risk, all else being equal. "If you have two loans with the exact same attributes, the person with the lower FICO score has a higher probability of default. If I take person with the higher FICO, give them a piggy-back second or a stated-income loan" and the default risk increases, he says.

Costello says FICO scores can still be useful as "part of a healthy balanced diet."

PMI Group, which insures mortgages with low down payments, uses FICO scores "as one of many different data elements in assessing risk," says Mark Milner, the firm's chief risk officer.

PMI looks at borrower-related data, including FICO scores; loan-related data, such as the interest rate and payment structure; and property-related data, such as whether the home is owner-occupied, a rental, single-family or condominium.

"For what it is, a FICO score is a very strong variable. But it's hardly the only one," says Milner.
Ron Totaro, Fair Isaac's vice president of global scoring solutions, says the FICO revamp has been in the works for 14 to 18 months and is not a reaction to recent criticism.

"We've talked to lenders, regulators and individuals who use FICO scores to drive their decisions. There has been no feedback that says these scores are working any differently than they have over the last 18 years," Totaro says.

The new version could be a reaction to VantageScore, a credit-scoring system developed jointly by the nation's three major credit-reporting agencies: Experian, Equifax and TransUnion.
Fair Isaac has sued the three agencies, alleging that VantageScore violates antitrust laws and confuses customers.

One of VantageScore's touted benefits was that it would do a better job with thin-file customers, meaning those without much credit history such as young people and recent immigrants.
The FICO upgrade also expands assessments of thin-file borrowers.

Fair Isaac now divides the population into 10 segments based on credit histories and applies a slightly different formula to each. Eight segments include people with no serious credit blotches and two are for people with serious problems.

The new system will divide the population into 12 segments: eight for people with good credit and four for people with bad credit. This will deliver better results for people in the lower end of the credit spectrum, Watts says. The system also incorporates changes in consumer behavior since its last upgrade.

Net Worth runs Tuesdays, Thursdays and Sundays. E-mail Kathleen Pender at
kpender@sfchronicle.com.

This article appeared on page E - 1 of the San Francisco Chronicle

FACTBOX - FICO credit score components, from Reuters, Posted By Robert Paisola

2007-05-10T22:15:00.000-06:00

FACTBOX - FICO credit score components

Thu May 10, 2007 5:09PM EDT

Credit scores, dominated by the Fair Isaac Corp.'s FICO system, are relative measures of a person's creditworthiness.

The scores are used by banks and other lenders to determine if a person will get a loan and how much they will pay.

Here are components of the FICO score:

-- Payment history, 35 percent of score. Late payments on credit cards, mortgages, student loans etc. will show up here and reduce the score.

-- Amounts owed, 30 percent of score. Total amount owed on a credit card compared with the total credit line. The higher the amount owed relative to the credit line, the lower the score.

-- Length of credit history, 15 percent. A short credit history will reduce the score. Experian, Equifax and TransUnion have developed VantageScore to reach more people with "thin" credit histories.

--New credit, 10 percent. The more request one makes for new credit accounts, the riskier they are perceived.

--Types of credit used, 10 percent. FICO considers the mix of credit cards, retail accounts and mortgages.

Opinions differ on effectiveness of FICO score, Posted by Robert Paisola

2007-04-29T20:56:00.000-06:00

Opinions differ on effectiveness of FICO score

Fair Isaac says its FICO score works just fine. But rising defaults have prompted some to question whether the system has flaws.

By Thomas Lee, Star Tribune

Don't blame the messenger.

That might not be anyone's idea of a great corporate slogan, but executives at Fair Isaac Corp. are finding themselves playing defense this year about the company's most vaunted product.
As subprime mortgage defaults continue to rise, some lenders are questioning the value of Fair Isaac's FICO score, which measures a consumer's ability to pay back a loan.

"FICO scores were one of the best predictors of early defaults," said Glenn Costello, an analyst with Fitch Ratings, a credit-rating agency based in New York. "Today, that is not true."

In December, a top executive with HSBC Finance, a major subprime lender, told investors that FICO scores were "less effective or ineffective" in predicting behavior during a period of aggressive lending and low interest rates.

Defenders of the FICO score say the product works just fine. They say overaggressive lenders, hungry for profits, are more to blame for the increasing number of defaults among homeowners, because they loosened underwriting standards to take in more marginal borrowers and also sold riskier products such as adjustable-rate mortgages.

"We're confident that FICO does what it is supposed to do," said Ron Totaro, vice president of global scoring solutions for Minneapolis-based Fair Isaac. "Lenders develop their lending strategies, and they use as little or as much information as they want."

Totaro said there is "no evidence" that FICO scores are not effective when applied to borrowers who fit in the riskier subprime portion of the market.

Any perception that FICO is faulty could have serious consequences for Fair Isaac. FICO is both the company's best-known product and the most popular credit-scoring system in the United States. Last year, FICO scores generated $177.1 million in sales, about 21 percent of Fair Isaac's total revenue.

What's worse, the company has already been struggling to boost its sales. Last week Fair Isaac said second-quarter revenue fell 3.4 percent to $201 million.

FICO also faces a challenge from VantageScore, a new credit-scoring system developed and marketed by Experian, TransUnion and Equifax, the country's three top credit-reporting agencies. Fair Isaac is suing the agencies, claiming VantageScore violates antitrust laws. By jointly offering VantageScore, the agencies are in the position to shut out FICO and other competitors from the credit-scoring market, according to papers filed in U.S. District Court in Minneapolis.

VantageScore executives see the subprime fallout as an excellent chance to promote their product.

"Absolutely, it helps us," said Barrett Burns, VantageScore's chief executive. "It offers us a great opportunity for lenders to look at VantageScore. Since our score is more accurate and predictive, there would have been improvement" in mortgage defaults had the industry used VantageScore instead of FICO, he said.

A recent Fitch Ratings report seems to lend some support to Fair Isaac in the debate. Some of the industry's riskiest subprime products -- high loan-to-value mortgages, piggyback loans and others that required little or no documentation of income -- made the FICO score "less significant relative to other attributes as an early default indicator," Fitch said.

In 2003, loans that defaulted within 12 months of issuance had FICO scores that were 30 points less than loans that did not default. Last year that difference shrank to 10 points, according to Fitch.

Others say the troubles among subprime loans simply show the limitations of credit scores. Loan officers can't look to FICO scores when trying to weigh how changes in interest rates, the type of loan or sudden events could affect a borrower's ability to pay, said John Ulzheimer, president of Credit.com Educational Services, a San Francisco-based financial services company.
"The score is the score," said Ulzheimer, a former Fair Isaac manager who helped build credit-scoring models. "It doesn't take into account external factors."
For instance, Hurricane Katrina's devastation could have turned healthy FICO scores of 750 among Gulf Coast residents into 450s in a relatively short period of time, in which case "the credit scores looked like they had failed," Ulzheimer said.

Still, credit-scoring companies must do a better job in establishing consistent scores for borrowers with patchy credit, said Craig Focardi, an analyst with TowerGroup, a research and consulting firm in Needham, Mass. Credit scores below 640 fluctuate more often than scores of 700 or better, he said. Companies such as Fair Isaac also should develop credit scores that take into account additional categories of risk instead of "lumping customers into similar brackets," he said.

Fair Isaac sells a product called NextGen FICO that Focardi says better measures the credit risks posed by subprime borrowers, but mortgage lenders have been reluctant to adopt it because it costs more than a standard score. VantageScore could inject some needed competition into the business, Focardi said.

"The mortgage industry needs to reevaluate whether one score is good for all customer segments," he said.

Totaro of Fair Isaac said the company constantly updates and refines FICO scores. Asked if some subprime lenders are unhappy with the service, Totaro replied: "We have talked to numerous clients. We will work with them to show them how the FICO scores work."

Ulzheimer said lenders never liked FICO scores, especially when a low score disqualified a potential borrower from getting a loan. Most lending operations are set up so that fees are generated by granting loans, not turning people away. But in the recent housing boom, lenders just got too greedy and sold unsuitable products to consumers, he said.

"You do your best to explain how the model is built and what it can do," Ulzheimer said. "But some lenders are going to do whatever they want to do. You never hear from lenders when things are going well. But the minute the FICO score doesn't do what they want it to do, it's amazing how loud they scream."

Thomas Lee • 612-673-7744 • tlee@startribune.com

©2007 Star Tribune. All rights reserved.

Robert Paisola, CEO of Western Capital, Announces 2007-2008 Price Schedule

2007-04-08T22:47:00.000-06:00

Due to the Recent Media Attention, we have been receiving a large number of calls regarding how much it would cost to have Robert Paisola speak at events throughout the world. Here is a simple price sheet. Prices are subject to change based on topics covered, Profit or Non-Profit and General Attitude of the Requestor.

See www.RobertPaisola.com for an Introduction based on the Hit Movie "THE SECRET"

2007-2008 Fee Schedules

Email : bookings@mycollector.com for the next Available Date!

3 1/2 FULL DAYS ONSITE WITH ROBERT AT YOUR LOCATION ANYWHERE IN THE WORLD $15,500.00 USD

3 1/2 FULL DAYS ONSITE WITH ROBERT AT YOUR LOCATION ANYWHERE IN THE WORLD ON TIMESHARE SALES $12,500.00 USD

CONVENTIONS, TRADE SHOWS, CORPORATE MEETINGS & CONFERENCES

NORTH AMERICA (Includes Canada and Mexico)

Keynotes and Seminars (up to 3 hours) $6.995,000

Full Day Seminars (up to 6 hours) $8,995.00

INTERNATIONAL

Keynotes and Full Day Seminars $15,500 USD

MULTIPLE PROGRAMS

We offer a 50% discount for additional programs booked for the same day at the same conference. For example, the first program is contracted at full price and every additional program is contracted at half price. We offer a 25% discount for additional programs booked by the same client/sponsor. For example, the first program is contracted at full price and every additional program is contracted with our 25% multiple booking discount. NOTE: This discount is applicable only if the contracts are issued simultaneously.

MEDIA & PUBLICITY

In order to create excitement and awareness of Mr. Paisola’s appearance at your event, he is happy to fulfill media requests when his schedule allows. Pre-recorded interviews are preferred over live interviews.

TRAVEL EXPENSES

Travel expenses are in addition to the speaking fee. Travel expenses include first-class airfare, up to 2 night’s hotel accommodations (Before and After the event) (king, non-smoking, guaranteed late arrival), meals and ground transportation in host city. A $75 per diem is also charged to cover ground transportation in home town, tips, and meals while traveling. To reduce Mr. Paisola’s out of pocket expenses, we request that hotel room charges be billed directly to the organization’s master account. When Mr. Paisola’s schedule includes more than one program on the same tour, airfare expenses are prorated.

HOLDING & CONFIRMING DATES

If you have specific dates in mind for your meeting, we're more than happy to hold a date for you. This hold can be placed on our calendar for up to 30 days. If another client requests the dates you are holding, you will be notified by phone and given 48 hours to make your decision either to go to contract or release the dates. To secure the date, a program agreement will be issued. This agreement is to be executed and returned within two weeks and requires a 50% deposit. The remaining 50% balance is due two weeks prior to the appearance.

RECORDING THE PRESENTATION AT YOUR EVENT

If you wish to video or audio tape Mr. Paisola’s presentation, you must sign a release. There are two forms; one is if you wish to use the recording for archival purposes only. The other is for those who wish to make the recording available to attendees or later for a period of time (either video or audio.) In either case, the releases must be signed, returned and approved by Robert Paisola

What Clients Are Saying About Robert’s Presentations:

"The best four days I have spent in my life!"
Bill Howell, President, Destination San Antonio

"This was by far the best class that I have ever attended.
You covered so much valuable information; I want to get back to my queue NOW!"
Donna Walker, Associates Capital

“Wow! So well organized! Awesome Personal Touch,
Great information presented in easy to understand language.”
Sandy Anderson, ExTerra Credit Recovery

“Well presented, clear, concise. Excellent pacing and delivery. Powerfully packed with quality information. A fantastic seminar minutes that will make me thousands of dollars in commissions!
Russell Stone, American Premier Holdings

Robert is teacher that knows his stuff and, more importantly, he presents it in a way that makes even my seasoned collectors collect more cash!”
Jennifer Barnett, DSH Financial Services

"Robert Paisola is incredible, My staff increased gross collections 130% after his trainings"
Gary Lee Gammenthaler, CEO, Mountain States Financial

--------------------------------------------------------------------------------

CALL NOW to receive Rob’s topic outlines, fee schedule, availability or to schedule a training.

1-877-517-9555

or

801-619-4700

See www.RobertPaisola.com for more Details

*Discounts May Be Available based on Location

Fair Isaac filed anti-trust suit against Equifax, Trans Union and VantageScore

2006-10-14T02:33:00.000-06:00

Fair Isaac sues credit-scoring companies

Thursday October 12, 3:11 pm ET

Fair Isaac Corp. said Thursday that it has filed an antitrust lawsuit against three agencies that have partnered to launch their own credit-scoring system, VantageScore.
Fair Isaac said the three agencies—Equifax Inc., Experian Information Solutions Inc. and TransUnion—are using anti-competitive practices to market their new product.

Minneapolis-based Fair Isaac has its own credit-scoring system, FICO. All three defendants have the ability to set a price for what a lender pays for FICO scores, and can also set prices for VantageScore. This ability allows the companies to unfairly promote their product by manipulating pricing, Fair Isaac argues.

“We have competed against the credit-report agencies’ scoring products for many years, and we are happy to compete on a level playing field,” said Tom Grudnowski, CEO of Fair Isaac, in a statement. “However, the recent agreement between the three powerhouse agencies unfairly threatens our ability to compete and inhibits the ability of consumers and lenders to enjoy the benefits of continued innovation, choice and competition in the credit-information marketplace.”

Fair Isaac (NYSE: FIC - News) is a credit-scoring and software company.

Published October 12, 2006 by the Minneapolis/St Paul Business Journal

This has to be about as absurd as it gets! Hopefully they’ll waste a TON of money on suing each other and MAYBE somebody will file the lawsuit on behalf of consumers.

After all, creditors pay PENNIES for credit reports and scores and the CRAs and Fair Isaac conspire to OVERCHARGE consumers, charging literally thousands of percent more to consumers than to businesses for the same products.

CreditData Southwest paid 15 cents per FICO score

There you have it ... and what are the “consumer advocates” doing?

Computer Security: ChoicePoint's Lessons Learned

2006-06-26T20:35:00.000-06:00

Computer Security: ChoicePoint's Lessons Learned
By Todd Spangler

A year and a half after mistakenly selling consumer info to criminals, the data broker says it has put in dozens of new policies and procedures to make sure such a security breach doesn't happen again.

A rash of security breaches has hit the headlines recently, chief among them the theft of a Department of Veterans Affairs' laptop with data on 26.5 million vets. Perhaps the best advice on how to respond if your company is caught in the line of fire comes from one that has been there itself: consumer data broker ChoicePoint.

In February 2005, ChoicePoint acknowledged that it had mistakenly sold personal information on thousands of individuals—as it turned out, more than 163,000 people—to bogus companies set up by Nigerian criminals (see ChoicePoint: Blur, from Baseline's June 2005 issue).

The Federal Trade Commission this January fined the Alpharetta, Ga.-based company $15 million for the disclosures.

Carol DiBattiste, ChoicePoint's chief credentialing, compliance and privacy officer, says the company has taken numerous steps in the past year to make sure such a breach never happens again.

"There's not a company around today that takes security more seriously than we do," claims DiBattiste, who joined ChoicePoint in March 2005 after serving as deputy administrator of the U.S. Transportation Security Administration. She says ChoicePoint has passed 43 security and privacy audits in the past year.

Gartner analyst Avivah Litan says ChoicePoint's security practices are now extremely strict—and appear to be among the best in any industry. "When you're fined and caught after a data breach," she says, "you really shape up."

Some of ChoicePoint's changes involved business practices. The company says it has improved customer-screening procedures, verifying their authenticity via multiple sources and by physically visiting their premises. It also now provides personally identifying information like Social Security numbers only as part of consumer-initiated transactions (as when someone applies for a home loan), as part of fraud-prevention programs or when requested by law enforcement officials.

But ChoicePoint has also tightened the screws on its information-technology infrastructure, with what DiBattiste says are more than 30 new policies and procedures.

It's enhanced user ID and password protections—if employees forget their passwords, they must take a five-question quiz (example: "What year was your Social Security number issued?") to reset it; if they fail that, they must pass a 15-question quiz with a systems administrator.

ChoicePoint has blocked access to its network from all non-U.S. Internet addresses, with a few exceptions that DiBattiste declined to detail. It has put employees at each of its 60 U.S. locations in charge of verifying the destruction of outdated consumer information, which the company is required by law to dispose of.

And the company now encrypts all data feeds to the three major credit bureaus as well as certain information stored in its databases, such as credit card numbers. DiBattiste adds that a project to move to laptop encryption "across the board" is still in the works.

Another new measure: ChoicePoint this month created a security advisory committee comprised of DiBattiste, the company's CIO, head of internal audit, the chief business officer, chief marketing officer, chief administrative officer and general counsel. The group meets regularly "to ensure we're hitting every aspect of security and privacy," says DiBattiste.
"One of the lessons we learned is that security is a moving target," she says. "The bad guys move too. So we have to constantly be in touch with the things we need to be doing to respond."

Credit Bureaus Hope to Displace FICO Score as Industry Standard

2006-06-23T10:49:00.000-06:00

June 22, 2006

The Experian credit agency became the first to start selling its new "VantageScore" credit scoring system this week. Critics aren't impressed.

John Ulzheimer of the credit information Web site CreditBloggers said that the hype over the VantageScore was "nothing more than an effort to confuse consumers and unsophisticated lenders."

"I'm not angry at the bureaus for trying to muscle out FICO," Ulzheimer said. "[M]y question is could they have spent their collaborative time together more constructively for consumers?"

The three credit bureaus jointly developed VantageScore as an alternative to the lending score created by the Fair Isaac Company (FICO), which is the standard score used by lenders to judge a borrower's creditworthiness.

For $5.95 a pop, users can buy the Experian VantageScore and see where the new credit system ranks them in terms of attractiveness to lenders. The new VantageScore system grades consumers on a number scale from 501 to 990, with a corresponding letter grade of "F" to "A."
Experian information solutions group president Kerry Williams says the new score "responded to the clear need for an objective scoring model that works across all three reporting companies' data."

Currently, Experian and fellow credit bureau TransUnion offer their own "proprietary" credit scores with the reports borrowers can purchase, but these scores are often wildly divergent from a consumer's real FICO score.

Although the bureaus claim these scores are "educational," they're heavily advertised as being legitimate credit scores that borrowers can use to judge their credit stability. Lenders, however, largely prefer the traditional FICO score, due to its longevity and prominence in the industry.
Equifax, the third of the "Big Three" credit bureaus, has been offering its true FICO scores with its reports. The scoring formula FICO uses has been closely guarded by the company as a trade secret, and the major credit bureaus have to pay Fair Isaac a licensing fee to use it in their credit scoring and reports.

CreditBloggers founder Emily Davidson purchased her VantageScore on June 20th and compared it to her Experian FICO score. According to Davidson, the ordering process was clumsy and counterintuitive, and the score ranking did not include information from her Experian credit report.

"Experian's VantageScore was difficult to interpret and their ordering system was poorly designed," she said. "If the bureaus are serious about competing with FICO, they need to work on making this score the best in the industry for both consumers and businesses."
The new credit score system has been criticized for making the same mistake as the current credit scoring system -- relying on inadequate or inaccurate data reported to the bureaus.
Sloppy record-keeping, mixing of different consumer records, and complex dispute resolution processes mean that even if the three bureaus are sharing the same score, they're still relying on bad data to make their scoring decisions.

Mortgage rate can't go up if lending bank is bought!

2006-06-04T19:30:00.000-06:00

DAVID MYERS: Mortgage rate can't go up if lending bank is bought

June 4, 2006

Dear David: I was lucky enough to refinance when mortgage rates bottomed out at about 5.5% last year. Now, the bank that gave me the mortgage is being purchased by another lender. Can the new lender raise my rate?

Dear Reader: The terms of your mortgage cannot be changed simply because your current lender is being purchased by another bank. About the only thing the new lender can do is require that your monthly payments be sent to a different address.

Dear David: We are interested in creating a basic living trust, so we purchased two books about estate planning to learn more. One of the books recommends that in addition to creating a trust, people should also sign a "durable power of attorney for finances" form. Is this really necessary?
Dear Reader: You're not required to sign a durable power document to create a money-saving trust, but many homeowners choose to do so for personal reasons.

Forming a simple living trust is an inexpensive way to help ensure that your home and other assets will pass quickly to your heirs instead of going through the long and costly probate proceedings that are mandated by a typical will. When you die, the successor trustee you selected can distribute your home according to your wishes.

If you also sign a durable power of attorney form, you'll give the successor trustee the additional ability to take care of any assets that you left outside the trust. The forms are available for about $5 at most business-supply stores.

Dear David: I recently applied to refinance my mortgage. Instead of giving me a FICO credit score like I have received in the past, the lender used something called a "VantageScore." What is that?

Dear Reader: A California-based company called Fair Isaac revolutionized the credit-reporting industry several years ago when it developed the FICO score, which many lenders use today when setting the interest rate to charge on everything from mortgages to credit cards.
VantageScore was developed by the nation's three largest credit bureaus. The system assigns a letter grade to each applicant's rating -- an "A" for borrowers who are in the top 901 to 990 bracket, a "B" for those in the 801 to 900 range, and so on down to "F." The higher your VantageScore, the lower your loan rate.

VantageScore was unveiled earlier this year. Though its scoring system should be easier for most consumers to understand, only time will tell whether it can replace the FICO system.

Contact DAVID MYERS at P.O. Box 2960, Culver City, CA 90231-2960.
Copyright © 2006 Detroit Free Press Inc.

Submit Your Complaints to the FTC Online

2006-05-27T23:00:00.000-06:00

Federal Trade Commission Title: Advance Notice of Proposed RulemakingSubject Category: Procedures to Enhance the Accuracy and Integrity of Information Furnished to Consumer Reporting

16 CFR Parts 660 and 661Published: March 22, 2006 View Notice (PDF) (Download Adobe Reader)Comments Due: Monday, May 22, 2006

How To Comment: The Commission in

vites interested parties to comment and submit information useful for developing guidelines and regulations required by Section 312 of the Fair and Accurate Credit Transactions Act. This is part of a joint rulemaking initiative where several agencies must:

establish guidelines for use by persons that furnish information to consumer reporting agencies regarding the accuracy and integrity of the furnished information and establish reasonable policies and procedures for implementing those guidelines.

Section 312 also requires the "Agencies" jointly to prescribe regulations that identify the circumstances under which a furnisher shall be required to reinvestigate a dispute concerning the accuracy of information contained in a consumer report based on a direct request of the consumer Privacy & Use The FTC Act and other laws the Commission administers permit the collection of public comments to consider and use in this proceeding as appropriate. All timely and responsive public comments, whether filed in paper or electronic form, will be considered by the Commission, and will be available to the public on the FTC Web site, to the extent practicable, at www.ftc.gov.

Any information placed in the following fields on this form -- "Title," "First Name," "Last Name," "Organization Name,' "State," "Postal Code," "Country,' "Comments," and "Attachment" -- will be publicly available on the FTC Web site. Although filling out this comment form is voluntary, the fields marked with an asterisk are required in order for the FTC to fully consider a particular comment. As a matter of discretion, the FTC makes every effort to remove home contact information for individuals from the public comments it receives before placing those comments on the FTC Web site.

More information, including other routine uses permitted by the Privacy Act, may be found in the FTC’s privacy policy, at http://www.ftc.gov/ftc/privacy.htm. Accessibility If you are unable to access this form, click here for an alternate method of submitting a public comment.

Subscribe to The www.VantageScoreFacts.com Blog

2006-05-05T08:52:00.000-06:00

How to Comply with the Fair Credit Reporting Act Teleseminar series

2006-05-05T08:47:00.000-06:00

How to Comply with the Fair Credit Reporting Act Teleseminar series

What: To supplement its online How to Comply with the FCRA subscription service (click here for more information), CDIA launched a series of distance learning opportunities to educate the industry on credit reporting issues.

Who: There are specific teleseminars are targeted at different groups that must comply with the FCRA:

• CDIA Members (Consumer Reporting Agencies); and• Non-Members of the CDIA (data furnishers, law professionals and more)

Where: Anywhere! You can participate in teleseminars from the comfort of your office, home or anywhere! These are distance-learning opportunities that save you travel costs and time. Materials are distributed to participants via CDIA's website or email prior to the call.
When: Teleseminars focusing on different issues will be offered throughout the year. Scroll down for a schedule of events. This schedule is updated throughout the year.

Please see the current schedule below for currently scheduled topics, dates and to download registration forms.

Upcoming Teleseminar Dates and topics:

Note: Subscribers to CDIA's How to Comply with the FCRA service receive discounts on this teleseminar series. Click here to subscribe or to learn more.

2006 CDIA How to Comply with the FCRA Teleseminars:
Click on each of the following teleseminar titles to learn more:

Legislation & State Law Updates: A CDIA Teleseminar Featuring CDIA Vice President and Counsel of State Government and Regulatory Affairs

New FTC Issued Consent Decree on Security Breach

New Identity Theft Red Flag Rule

Legislation & State Law Updates: A CDIA Teleseminar Featuring CDIA Vice President and Counsel of State Government and Regulatory Affairs.

Featured Speaker: Eric Ellman, Consumer Data Industry Association

• Thursday, May 4, 2006
2:00 p.m. - 3:00 p.m. Eastern

Program Highlights:
More than half of the states in the U.S. have FCRAs in effect. They not only differ from state to state but often raise compliance issues with the federal Fair Credit Reporting Act as well. Eric J. Ellman, Vice President and Counsel of State Government and Regulatory Affairs, will host a teleseminar on Thursday, April 20th & May 4th at 2:00 pm Eastern. Each teleseminar will survey state legislation in 2005 and highlight trends in new state laws that require legal and compliance attention for consumer reporting agencies, data furnishers, and data users. Included in this review will be legislation and laws that address security freezes, security breaches, the use of Social Security Numbers, and the use of credit header information.

Who Should Register: Companies who have to comply with FCRA current state laws across the United States

This call will be 60 minutes in duration and include a question and answer portion where participants can ask questions.

To register for this event, please click here.

“There was such a popular demand for this teleseminar that we are running it again on May 18th.”

FTC Issued Consent Decree on Security Breach(Speaker: Anne Fortney, Partner with the Hudson Cook, Moderator: CDIA President and CEO Stuart K. Pratt)

• Thursday, May 18, 2006
2:00 p.m. - 3:00 p.m. Eastern

CDIA has brought back by popular demand the teleseminar covering the FTC Consent Decree regarding ChoicePoint. On May 18th at 2:00 p.m., Anne Fortney, partner with The Hudson Cook law firm and former compliance official with FTC, will share her thoughts on the breach issue as it relates to the FTC actions earlier this year. Gain some insight on what this means for other companies that handle consumer information.

This event is open to both members of CDIA, as well as non-members (including data users, data furnishers and other that must comply with the FCRA).
To register for this event, please click here.

Identity Theft Red Flag Rule
Speaker: Amy Friend, Assistant Chief Counsel of the OCC, Moderator: CDIA President and CEO Stuart K. Pratt)

• Thursday, May 25, 2006
2:00 p.m. - 3:00 p.m. Eastern
Amy Friend, Assistant Chief Counsel of the OCC, will be available to discuss the Identity Theft Red Flag Rule at the CDIA teleseminar on May 25th at 2:00 p.m. The Rule, included in the 2003 FCRA FACTA amendments, is expected to be completed this month. You will hear not only a discussion of the just published Rule but also have your questions answered by the principal author of this Rule. You will be hearing more about this teleseminar in the coming weeks.

To register for this event, please click here.
How to Comply with the FCRA Subscription Information:
Non-Members should go to the CDIA E-Store at https://www.cdiaonline.org/store/htc.cfm to subscribe to the How to Comply Service.

Members should logon to Members Only* at https://www.cdiaonline.org/members/index.cfm, select "Member E-Store" and then select "Online How to Comply with the FCRA," to purchase a subscription to How to Comply or sign up for a free 24-hour demo (redline not included in demo).

Please contact CDIAonline at cdia@cdiaonline.org with questions.
Can't participate in a Teleseminar?

Recordings are available for these events. CDIA offers Audio CDs on all its current and previous Teleseminars.

Again- Who and What is E-Oscar!

2006-05-05T08:39:00.000-06:00

Consumer Data Industry Association (CDIA), in cooperation with Equifax, Experian, Innovis and TransUnion, is proud to announce the creation of a new state-of-the-art solution for processing ACDVs and AUDs. The new network, E-OSCAR, is the Online Solution for Complete and Accurate Reporting. E-OSCAR is a browser-based, Metro 2 compliant system that is secure, intelligent and intuitive.

E-OSCAR provides multiple benefits, as detailed below. We have enhanced our technology to be a web-based system. It was created with the awareness of the need for strong security around the sensitive data that will be sent through the network. We have provided a toll free industry Help Desk and, in addition, we have significant training resources available to you.

We know that as a leader in the credit industry who is concerned about the FCRA and data quality, you will want to be involved in the initial offering of E-OSCAR. Participation in the new network will provide key customers like you with any necessary personalized attention that you need during your transition. E-OSCAR is fully compliant with the new FCRA and so easy to use that you will want to become part of this new system!

Please begin the steps necessary to move from the current network onto the new one.
Alert your senior management to the upcoming changes. View the information links below to learn more about E-OSCAR. Make Use of the Implementation Checklist to plan your conversion.

What’s happening with E-OSCAR-webTM April 23, 2003

Valued Customer,

We are pleased to inform you that the E-OSCAR-web? Solution is complete and available for use. The Credit Community Network Service (CCNS) supported by Global eXchange Services (GXS, formerly GEIS) will no longer receive new ACDV transactions after May 15, 2003. You will be able to respond to these items until June 15, 2003.

In an effort to assist you with your transition and to ensure that your company is not adversely affected, the Consumer Data Industry Association (CDIA), Equifax, Experian, Innovis and TransUnion have prepared these instructions for you.

If you do not register with E-OSCAR and begin to use this solution to respond to disputes and/or submit automated Universal Data Forms, the National Consumer Reporting Agencies (NCRAs) will send your disputes via paper. In order to ensure that you do not receive paper disputes, you must follow the steps below and register with E-OSCAR

Register immediately at http://www.e-oscar-web.net (If you have already registered, follow steps 3 and on).

We recommend that you print a copy of the registration you’ve completed, as well as, write down and keep in a safe place, the USER ID and password that you’ve created during the registration process.

Once you have received approval notice from one or more of the NCRAs, you should begin the on-line training. If you plan on having multiple users, now is the time to create a USER ID for each of those parties and be sure that all of the users have completed the on-line training prior to receiving ACDVs from the NCRAs.

During the next few weeks, we will begin the final phase of moving the transaction volume of customers from the GXS System to E-OSCAR. We would like to begin getting your AUDs as soon as your registration is approved. We will coordinate with you on transmitting your ACDVs, but we recommend beginning as soon as possible and no later than May 1.

During the registration approval process some of the NCRAs will provide you with a list of the reporting subscriber codes they show affiliated with your particular GXS mailbox. If a bureau does not, you may print off your existing Subscriber Code Table from your current GXS ACDV Software PC at your location. You will need to enter these codes into E-OSCAR after the NCRAs approve your registration. This will assist you in receiving all of your disputes via E-OSCAR without delay.

You must contact each of the NCRAs that you report to and coordinate a date that you would like to begin receiving your ACDVs. As soon as your subscriber codes are approved you may submit AUDs.

Submit the necessary request form to Global eXchange Services to cancel any active mailboxes. Please copy the NCRAs on your request (Addresses are listed at the bottom of this letter).
Respond to all ACDVs remaining in your GXS ACDV Mailbox.

Delete all subscriber codes associated with the mailbox using the GXS PC-based software; this will disable Mortgage Reporting Companies as well as NCRA Affiliates from utilizing the system thus allowing GEIS to effectively close the mailbox.

Call the E-OSCAR Help-Desk if you have any questions. 1-866-MY-OSCAR.

Contact Information: CCNS Administration Global eXchange Services, (GXS) 100 Edison Park Drive Gaithersburg, MD 20878 Help Desk (800) 892-1574 Fax- 301.340.4583

Equifax Credit Information Services Charles Saunders LaDeamya Mixon 1550 Peachtree St. Mail Drop 66N Atlanta, GA 30339 E-mail: Equifax.EOSCAR@equifax.com Phone: 800-925-3329

Experian Patrick Sahf 701 Experian Parkway Allen, TX 75013. E-mail - Patrick.Sahf@experian.com Phone - 972-390-3610

TransUnion 2 Baldwin Place Crum Lynne, PA 19022 Fax - 610/546-4602 Tracy DeMarco Phone 610/546-4753 Email - TDemarc@TransUnion.com Melissa Whayland Phone 610/546-4752 Email - MWhayla@TransUnion.com

Innovis Data Solutions 950 Threadneedle, Suite 200 Houston, TX 77079-2900 Jose M Cruz Phone 281/504-2629 Email: jcruz@innovis-cbc.com

E-OSCAR Help Desk Phone 1-866-696-7227 (MY-OSCAR)

So the CRAs ARE E-Oscar. Interestingly, the Experian attorney Marc Carlson told me last week that I need to get info about reporting from E-Oscar. Nice try! I guess I’ll have to file another notice of deposition to get to an Experian person with a clue about E-Oscar. Experian has been extremely difficult and I need to file a motion to compel.

Experian ensures that people with 5+ year old charge-offs OFTEN have a credit score as if they had just defaulted in recent months. Their profits increase as the credit scores are lowered by their incorrect reporting.

http://www.e-oscar-web.net/ is where creditors log in. Submitting FACTUAL disputes sure doesn’t do the trick, so maybe that’s an alternative.

The PRIVATE E-oscar.org domain registration:

Court Says Furnishers Face Reinvestigation Liability

2006-05-05T08:34:00.000-06:00

The U.S. District Court for the Northern District of Illinois has ruled that consumers may sue those who furnish data to credit reporting agencies for failure to carry out their reinvestigation responsibilities under Section 623 of the FCRA. (Dornhecker v. Ameritech Corp., N.D. Ill., No. 00 C 26, 6/7/00). The judge ruled that while the FCRA does not specifically create such a liability, one could be implied from the way the law is written. The case involved telephone accounts that were fraudulently opened in some consumers names. When the subsequent debts were not paid, the phone company retained a collection firm to pursue the bad debts. The collector reported the adverse information to the credit reporting agencies and when the consumers found out about it they asked the credit reporting agencies for reinvestigation of the data as well as reported the fraud to the phone companies.

Two of the consumers sued the phone company, alleging it violated Section 623(b)(1) of the FCRA by failing to properly reinvestigate the disputed data. The phone company said it was only obligated to pursue a reinvestigation when contacted by the credit reporting agency. The consumers argued that furnishers duties under Section 623(b)(1) are indeed owed to consumers. They pointed out that Congress' exemption of furnishers from liability under subsection (a) implicitly made them liable under subsection (b). If Congress had meant to exempt furnishers from liability under subsection (b), it would have stated that fact as it did in subsection (a).

The court said it ruled as it did because it's apparent consumers are members of a class that the FCRA sought to protect and that legislative history shows an affirmative attempt by Congress to hold furnishers of information accountable if they continue to supply inaccurate data after they have been notified. It also backed its decision based on two cases that had been previously adjudicated.

The first involved a similar suit by a consumer over reinvestigation responsibilities under Section 623(b)(1). The court held that "there is no authority supporting the proposition that the FCRA does not create a private right of action". The court recognized that furnishers were exempt from civil liability from subsection (a), the FCRA did give consumers a cause of action against "persons" who are willful or negligent in complying with the Act.

The second citation concerned a case that set forth factors for determining if a private cause of action is implicit in a statute. Saying this case met all four factors, the court concluded that the consumers could file suit against furnishers of data for failing to comply with Section 623 (b)(1).

What is e-Oscar?

2006-05-05T08:29:00.000-06:00

e-OSCAR is a web-based, Metro 2 compliant, automated system that enables Data Furnishers (DFs), and Credit Reporting Agencies (CRAs) to create and respond to consumer credit history disputes. CRAs include Equifax, Experian, Innovis and TransUnion, their affiliates or Independent Credit Bureaus and Mortgage Reporting Companies. e-OSCAR also provides for DFs to send "out-of-cycle" credit history updates to CRAs.

The system primarily supports Automated Credit Dispute Verification (ACDV) and Automated Universal Dataform (AUD) processing as well as a number of related processes that handle registration, subscriber code management and reporting.

ACDVs initiated by a CRA on behalf of a consumer are routed to the appropriate Data Furnisher based on the CRA and subscriber code affiliations indicated by the DF. The ACDV is returned to the initiating CRA with updated information (if any) relating to the consumer's credit history. If an account is modified or deleted, carbon copies are sent to each CRA with whom the DF has a reporting relationship.

AUDs are initiated by the DF to process out-of-cycle credit history updates. The system is used to create the AUD and route it to the appropriate CRA(s) based on subscriber codes specified by the DF in the AUD record. The e-OSCAR AUD process is intended to provide the CRA with a correction to a consumer's file that must be handled outside of the regular activity reporting cycle process. e-OSCAR may not be used to add or create a record on a consumer's file or as substitute for "in-cycle" reporting to the CRAs.

To see a demo of e-OSCAR-web, contact the Help Desk at 866-MY-OSCAR (866-696-7227) to obtain a temporary user id and password, then log into www.e-OSCAR-web.net.Questions? Call the e-OSCAR help desk at (866) MY OSCAR or (866) 696-7227.

Equifax Credit Information ServicesRichard Stinnett1550 Peachtree St.Mail Drop 66NAtlanta, GA 30339E-mail: Equifax.EOSCAR@equifax.comPhone: 678-795-7921 Effective Nov 15, 2005

Experiane-OSCAR Customer Support 701 Experian ParkwayAllen, TX 75013.E-mail: experian.e-oscar@experian.comPhone: 972-390-3610

TransUnionTransUnion e-OSCAR Customer Support LinePhone: 610-546-4762

Innovis Data SolutionsMichelle Junk1651 NW Professional PlazaColumbus, OH 43220Phone: 614-442-3710E-mail: michelle.junkschleter@innovis.com

The New Way Lenders Will Size You Up

2006-05-04T18:59:00.000-06:00

Just when you finally had FICO figured out, you're getting a brand new score

By Amanda Gengler

April 18, 2006 11:03 PM EDT

(MONEY Magazine) – So the Fed raised rates another quarter point in March. Ho hum. The far bigger news that may affect your future borrowing rates: the unveiling of a new rating system that will compete with the widely used FICO credit score. Developed jointly by the three major credit bureaus, VantageScore should reduce discrepancies between your scores at the agencies, they contend. But it's also likely to lead to confusion, since VantageScore ratings will range from 501 to 990 (a 901-plus score is an A; 801 to 900, a B; down to 501 to 600, an F) vs. 300 to 850 for the FICO scale. For example, a 720 FICO score could land you a 9% rate on a credit card; with VantageScore, 720 might give you a 20% rate, says Curtis Arnold of CardRatings.com. For more info on the new system, go to vantagescore.com.

Fair Isaac Spotlights Latest Strategies and Innovations for Smarter Decisions at InterACT 06

2006-05-02T09:06:00.000-06:00

CEO Grudnowski Delivers Insight into the Growing Impact and Applications of Enterprise Decision Management to Customers from 33 Countries

SAN FRANCISCO--(BUSINESS WIRE)--May 1, 2006--Fair Isaac Corporation (NYSE:FIC - News), the leading provider of solutions and technologies for Enterprise Decision Management (EDM), kicked off its 2006 North American InterACT customer conference today in San Francisco. In his opening address, CEO Tom Grudnowski discussed how Fair Isaac's ongoing pursuit of innovation is breaking new ground to help organizations transform and improve the way they make their most critical decisions.

InterACT, the world's leading business forum on business analytics, emerging decision management technologies and their applications, is being held this week in San Francisco, where Bill Fair and Earl Isaac started the company in 1956. Registered attendance of nearly 700 for the company's 50th anniversary conference is the highest in several years, demonstrating the growth in demand for EDM strategies and solutions.

Grudnowski told InterACT delegates that they are among the leading practitioners of EDM, which combines the analytic solutions and decision automation software organizations need to make their decisions more precise, more consistent and more agile, at every customer interaction or decision point. He also recognized clients' central role over the past 50 years in turning the company's solutions for risk management, fraud control, account management, business rules management and more into industry standards.

"We are very fortunate to have clients who understand and value what this company was born to do -- help organizations solve their most complex business problems by consistently making the right decisions at the right time," said Grudnowski. "We've been perfecting the science of EDM in our R&D labs, and working with you to perfect it in the form of thousands of successful deployments around the world. Bill Fair once said, 'We sell a radically different way of making decisions that flies in the face of tradition.' That was true in 1956, and it's still true today."
EDM Innovations in InterACT Spotlight

Key decision management innovations being showcased at InterACT 06 include:
Advances in the battle against fraud, including Fair Isaac's architecture for Enterprise Fraud Management, its vision of a fraud clearinghouse and its research into click fraud.
Fair Isaac's development of its ScoreNet® network, the first "Decision Services Provider" network. This growing network gives businesses access to hosted versions of Fair Isaac solutions, as well as more than 2,000 service providers and 70 third-party databases.
The latest release of Blaze Advisor(TM) business rules management system, the only such system powered by the Rete III algorithm. With Rete III, Blaze Advisor can run complex business rulesets up to 100 times faster than other rules engines.

The next phase in the company's EDM architecture for financial services, which will give banks a common platform for their decision management across the customer lifecycle, and connectivity between point solutions for different decision areas.

A new approach to customer-centricity called "CustomerHD," which uses leading-edge analytics to give marketers a high-definition view of customers and potential customers.
New insights into customer credit issues, including consumer sensitivity to debt load, U.S. and global regulatory issues in financial services, and the implications of HELOCs and debt consolidation for card issuers.

Today's general session also featured a keynote presentation by Jeffrey Sampler, a Fellow of Strategy and Technology at Oxford University and leading authority on how to manage information as a strategic resource for growth and innovation. Sampler provided perspectives on how to lead creatively, how to create business assets where none exist, and the power of the strategic vortex model -- building strategies one on top of the other.

About InterACT
InterACT brings together senior executives, business managers and analysts from the world's leading companies in financial services, insurance, retail, telecommunications, healthcare and the public sector. Fair Isaac began staging customer conferences in 1976 to provide the most-up-to-date insight and information on analyzing data for business decisions.
Over the next three days, InterACT participants can choose from more than 70 sessions, including case studies, research results, industry panels and strategy discussions on new EDM technologies and applications. Discussion groups and other conference events provide attendees with opportunities to connect with industry peers and Fair Isaac experts, and the InterACT Product Expo reveals Fair Isaac's latest analytic and decision management innovations.

About Fair Isaac

Fair Isaac (NYSE:FIC - News) makes decisions smarter. The company's solutions and technologies for Enterprise Decision Management give businesses the power to automate more processes, and apply more intelligence to every customer interaction. Through increasing the precision, consistency and agility of their decisions, Fair Isaac clients worldwide increase sales, build customer value, cut fraud losses, manage credit risk, reduce operational costs, meet changing compliance demands and enter new markets more profitably. Founded in 1956, Fair Isaac powers hundreds of billions of decisions per year in financial services, insurance, telecommunications, retail, consumer branded goods, healthcare and the public sector. Fair Isaac also helps millions of individuals manage their credit health through the http://www.myfico.com/ website. Visit Fair Isaac online at www.fairisaac.com.

Statements Regarding Forward-Looking Information

Except for historical information contained herein, the statements contained in this press release that relate to Fair Isaac are forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including risks described from time to time in Fair Isaac's SEC reports, including its Annual Report on Form 10-K for the year ended September 30, 2005, and its quarterly report on Form 10-Q for the period ended December 31, 2005. Forward-looking statements should be considered with caution. If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, Fair Isaac's results could differ materially from Fair Isaac's expectations in these statements. Fair Isaac disclaims any intent or obligation to update these forward-looking statements.

Fair Isaac, ScoreNet and Blaze Advisor are trademarks or registered trademarks of Fair Isaac Corporation, in the United States and/or in other countries. Other product and company names herein may be the trademarks of their respective owners.
Contact:Fair Isaac Corporation
Brian Kane, 612-758-5232
briankane@fairisaac.com
Source: Fair Isaac Corporation

Fair Isaac's reaction to Vantage Score System

2006-04-29T14:43:00.000-06:00

Fair Isaac's reaction to Vantage Score System

Heard about the new Vantage Scoring System? It's scheduled to be rolled out by the credit bureaus later on this year. This was posted on our discussion boards by a Fair Isaac employee (Fair Isaac created the existing model the credit bureaus use). The post can be found here. Yes, I believe the poster is an actual employee.

Before I share this info... Yes I am a Fair Isaac employee. And yes I obtained prior approval from our PR dept before posting this. This document was posted on our Intranet site last week.

March 23, 2006
FREQUENTLY ASKED QUESTIONS

BACKGROUND
On March 14, 2006, the three national credit reporting agencies, Equifax, Experian and TransUnion, jointly announced the creation and availability of VantageScore, a new credit risk score. According to their announcement, the new score was developed through a collaborative effort by all three credit reporting agencies. The score is being independently marketed and sold through each of the three credit reporting agencies via licensing agreements with VantageScore Solutions, LLC, a company that the agencies have established. The following FAQ provides answers for use by Fair Isaac employees to the most common questions directed to Fair Isaac in the days immediately following their announcement.

Q: Did Fair Isaac help develop the new score?No. Fair Isaac was not involved in the development of the new score, and any questions regarding VantageScore from sources outside of Fair Isaac should be directed to Equifax, Experian and TransUnion.

Q: Who has more experience in credit bureau-based risk scoring, Fair Isaac or the credit reporting agencies?Fair Isaac has the most experience. Behind our FICO® scores’ unsurpassed performance is 50 years of analytic expertise and 25 years of analyzing credit reporting agency data. We developed the first credit risk score in 1958, the first credit reporting agency score models in 1981, and launched the first general-purpose FICO score in 1989. Our analytic scientists have the most experience studying the nuances of data, allowing us to make the scores more powerful with each redevelopment.

Q: Is there a market for the new score? At this point, we don’t know enough about the underlying science of the new score to comment in detail.However, the ongoing – and growing – success of the FICO score demonstrates that Fair Isaac is already meeting the market’s demand for a consistent measure of credit risk across the three credit reporting agencies. FICO scores have been available since 1989 and are used by most lenders when making billions of credit decisions annually. FICO scores are routinely tested and have become relied upon by lenders, rating agencies, the Wall Street community and a growing base of consumer advocates and personal finance experts. Fair Isaac credit bureau risk scores provide a common language for risk in many industries, including consumer credit, commercial credit, mortgage and telecommunications. They are endorsed or used by such industry-leading organizations as Fannie Mae and Freddie Mac for secondary mortgage lending, and Standard & Poor’s and Fitch IBCA in the rating environment.

Q: Will the introduction of the new score hurt Fair Isaac?We are confident that, provided a choice, lenders will continue to rely upon FICO scores to make the most objective, fair and profitable risk management decisions. Competition has been a fact of life in our industry, and the individual credit reporting agencies have attempted in the past to compete with Fair Isaac by offering scoring alternatives. Yet, FICO scores have continued to be used by the vast majority of banks and lenders in the United States to make the smartest possible lending decisions and grow more profitable. This is the first time that the credit reporting agencies have coordinated their efforts to develop a new risk score and we will monitor lender reactions and take all steps necessary to ensure Fair Isaac remains lenders’ scoring system of choice.

Q: Will the new score replace FICO scores in lenders’ risk evaluation process?Based on what we know now, as long as the market is free from competitive restraint, competition from FICO scores (both Classic and NextGen) will be significant because FICO scores have widespread acceptance by consumer lending and securitization users, as well as acceptance by key regulatory bodies as reliable. Their confidence in FICO scores is the result of the FICO score’s proven predictability and Fair Isaac’s continuous work to update and fine-tune our scoring models to ensure the most precise risk predictions and score explanations possible. Lenders and regulators also value our neutrality in the credit data industry and our ability to objectively analyze and utilize credit bureau data – which differs from bureau to bureau – to generate highly predictive, reliable risk scores.

Q: Does the introduction of VantageScore signal a breakdown in Fair Isaac’s relationship with its credit reporting agency partners?No. Even as our partners introduce VantageScore, Fair Isaac is working with each of the three credit reporting agencies to continue delivery of billions of FICO® scores annually to lenders and other businesses. And we are planning to introduce additional products that Fair Isaac is developing in collaboration with the credit reporting agencies. Of course, we cannot speak to the intentions of the credit bureaus.

Q: How does the new score’s scale differ from the FICO scoring scale?According to the credit reporting agencies, their VantageScore uses a numeric scale of 501-990, and also a parallel alphabetic scale that classifies consumers into fixed A, B, C, D, F scoring 2 grades. These alpha grades strongly suggest that all lenders agree on levels of risk in neat, permanent scoring bands, which is contrary to Fair Isaac’s long experience with lenders. Again, we cannot comment on a system we have not yet seen. However, Fair Isaac can say that the FICO scale has served lenders and consumers well for decades, and is increasingly being understood and accepted by consumers as the standard score range. The classic FICO score uses a numeric scale of 300-850 that is well understood and accepted within the financial services industry and regulators. Most lenders’ strategies and securitization decisions within this industry are geared toward the use of the FICO score ranges and consumers. A new, different score range could create confusion for consumers and lenders alike.

Q: What does this different approach mean for consumers?At this stage, we don’t know enough about the new scoring system to comment in detail. However, a number of consumer groups, including Consumer Federation of America, have expressed the concern that the introduction of VantageScore adds confusion to a marketplace already filled with consumer misperceptions about credit scoring. Today, consumers can view their FICO credit scores and be confident that the scores are an indication of how most lenders view their credit risk. We will continue our efforts to help consumers understand that FICO scores are the same scores most lenders use now – and will continue to use – to make their lending decisions. myFICO.com is the one place where consumers can access their FICO scores across multiple credit reporting agencies and receive education from Fair Isaac on managing their credit scores.

Q: The three companies say this new score was developed in response to client demand. Have lenders been asking for a new scoring system?No. Fair Isaac stays in close contact with all the major U.S. lenders, and none of them have reported to us a desire for a new scoring system. Originally introduced in 1989 and available from all three credit reporting agencies since 1991, our FICO® scores have provided the same consistent and highly effective predictive power regardless of the credit reporting agency providing the data. We have regularly updated and improved our FICO scoring models in response to open feedback from major lenders.

Q: The bureaus claim that the new score uses the same scoring model across all three credit reporting agencies. How is the FICO score approach different?Each of the credit reporting agencies deploys the Fair Isaac scoring model design for Classic FICO scores and NextGen FICO scores. We believe our design utilizes the most predictive elements at each of the agencies to ensure highly predictive performance at each of the agencies – and to ensure that lenders can trust that a 680 FICO score generated on one bureau’s data 3 indicates the same relative level of risk as a 680 FICO score on another bureau’s data. Fair Isaac believes that every FICO score should be as predictive as possible based on the available data.

Q: How will the introduction of the new score impact myFICO.com?We have confidence that myFICO.com will continue its impressive growth as consumers understand that FICO scores continue to be the scores that most lenders use to make credit decisions. In fact, in the days after the bureaus introduced their new score, myFICO.com marked its top two revenue days in the history of the service.

Fair Isaac Statement Concerning Forward-Looking InformationExcept for historical information contained herein, the statements contained in this document that relate to Fair Isaac, including statements regarding its FICO score offering and the benefits to be derived from the offering, are forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncertainties that may cause actual results to differ materially, including issues involving the marketing and distribution arrangements for Fair Isaac’s products, any unforeseen technical difficulties related to the implementation, use and functionality of Fair Isaac’s product offerings, the risks that customers will not perceive material benefits from the offerings, failure of the products to deliver the expected results, the possibility of errors or defects in the offerings, regulatory changes applicable to the use of consumer credit and other data, and other risks described from time to time in Fair Isaac’s SEC reports, including its Annual Report on Form 10-K for the year ended September 30, 2005, and quarterly report on Form 10-Q for the period ended December 31, 2005. Forward-looking statements should be considered with caution. If any of these risks or uncertainties materializes or any of these assumptions proves incorrect, Fair Isaac’s results could differ materially from Fair Isaac’s expectations in these statements. Fair Isaac disclaims any intent or obligation to update these forward-looking statements.

Fair Isaac and FICO are registered trademarks of Fair Isaac Corporation, in the United States and/or in other countries. Other product and company names herein may be the trademarks of their respective owners.

Editor's take on this: Fair Isaac is very worried about this. And further more, I'd say that the Vantage system is an attempt of the Big 3 to break free of the Fair Isaac stranglehold on the credit scoring system. I'm sure the licensing of the credit scoring model developed from Fair Isaac is VERY expensive. I'd say a little competition is a good thing, but who knows how accurate the Vantage scoring system is. What kind of data do the credit reporting agencies have to back up the validity of their models?

Will consumers by hurt by it? Who will use it? Is it an attempt by the big 3 to stop lawsuits from those unfairly damaged by the system currently used by Fair Isaac, over which they have no control? I'd say there are more questions than answers at this point.

ABOUT THE POSTER: Robert Paisola is an international motivational speaker, trainer and author. He is an expert in the field of Personal Real Estate Investor Training. He is a professional speaker who has been featured on CNN, CNNFN, and the Wall Street Journal. He can answer your questions on the "Basics of the Real Estate Investing Business" to detailed issues regarding your specific transactions. Life Experience Robert Paisola is a Professional International Seminar Speaker in the Areas of Real Estate Investing, Tax Lien Investing, Rental Property Management, Real Estate Coach and Mentor Training and Business Management. He has served companies throughout the world. If you are interested in learning the business from someone like Rob email his office at mailto:robert@trumpworldwide.com or call our offices Nationwide toll Free at 1-877-517-9555 or visit http://www.allexperts.com/displayExpert.asp?Expert=38419 or visit www.RobertPaisola.com

The History of the FICO Score, by Robert Paisola

2006-04-27T01:51:00.000-06:00

The History of the FICO Score, by Robert Paisola

www.RobertPaisola.com

In 1956, math whizzes Bill Fair and Earl Isaac left the Stanford Institute to consult with the computer services industry. After creating a billing system for Hilton Hotels, Fair Isaac and Company created a credit evaluation method for a southern lender accused of racial bias. As credit cards emerged, Fair Isaac created a way for card issuers to quickly screen masses of candidates. Banks started using the company's scores, referred as FICO scored, to evaluate their own loans.

In 1995 the nations two biggest purchasers of home mortgages, Fannie Mae and Freddie Mac, announced that they wanted their loans to include a credit score. Fair Isaac designed a credit scoring system for all three bureaus to use and soon after, all loan processing agencies joined in and hence, the FICO score. FICO scores are what the majority of mortgage lenders use to evaluate applicants creditworthiness. The scores are based on complex statistical methods that analyze credit information on nearly every adult in the United States.

In barely 3 years, credit scoring has swept the loan business. Credit scores have existed for 40 years, but were applied to home loans only recently. If you've received a pre-approved credit card application in the mail, it was based on your credit score. High score, high credit line and low rate. Likewise, if a car finance dealership says that would be happy to process a loan on a car, but.... That is credit scoring at work again, except they will need a higher down payment or you need to pay a higher rate. Low credit score, higher down payment, higher rate.

Your ability to get a loan depends on your score. The people affected most are lower income borrowers. Most lenders get reports and scores from the 3 credit reporting bureaus, Experian, Equifax and Trans Union. That is because the credit bureaus rely on creditors to report borrowers' histories, and creditors don't always report to all three bureaus. Hence, the scores can differ. Most lenders will access all three scores and then average them. These numbers, based on past behavior, really predict a persons future likelihood to repay a loan. Studies have shown that regardless of race or income, borrowers with low scores defaulted much more often than people with higher scores.

Your credit report is a list of accounts that banks, merchants, government agencies and courts report that you are responsible for either solely or jointly. Each will show the accounts age, credit limit, current balance, high balance and payment history. All of this information is used in the credit scoring calculation. A credit score, based on the report information, is likened to a camera snapshot that captures your creditworthiness at the moment the score is calculated, so you can see how important it is to make sure that the information is correct and up-to date.

We all have a credit report and whether it is good or bad is something that you need to start thinking about. If you have ever financed a car, or had a loan of any sort, even a credit card you have a credit report. And if you have ever paid bills for anything like a cell phone or for electricity then you have a credit report. It is important that you have a good credit report for several different reasons. First of all if you have plans to buy a house someday or a new car then you are going to need good credit to be approved for financing. Most people do plan to purchase a home someday and you cannot do that unless you have good credit. Your credit rating will even affect the interest rates that you will be able to get your loans at. The lower your interest rate the more money that you will save.

I am sure that you have heard or read the offers that promise you that they will erase all of your bad credit history quickly and efficiently but these promises are false. No one can get rid of your bad credit history but you. Time is the only thing that will heal these types of wounds and anyone that promises you otherwise is lying to you.

A good tool for you to refer to when you are trying to rebuild your credit is the book written by the Federal Trade Commission (FTC). This book will teach you the following: your rights under the Fair Credit Reporting Act and your rights under the Fair and Accurate Credit Transactions Act. It will also teach you how to legally improve your credit, knowing how to do this the right way is important, this book will also teach you about identity theft and how it can affect your life and most importantly it will teach you how to deal with your debt once and for all.

The Fair Credit and Reporting Act is dedicated to making sure that your records are keep accurate, private and safe. It is the FTC that enforces the rules and laws as they pertain to the credit reporting companies. You have many rights that you probably do not have any idea what these rights are. One of your most important rights is the right to see your credit report. You have the right to a free copy once a year but you will have to request it, it will not be automatically sent to you. When you get your report you will also get a list of the companies and people who have also requested a copy of the report.

Most people wonder what exactly is on their credit report. Your credit report contains your name and address, birth date and Social Security Number as well as your employment history and your spouse's name. You will also find your home ownership, income, and previous address information. Some of these things may only be given to those who specifically ask for this information.

Your credit report will also have exact record of all your past history as far as the amount of credit that has been extended to you as well as how you dealt with this credit. If you have not paid your debts off according to schedule then this will be noted on the report. Every company, person or business that has ever requested a copy of your credit report over the last year, regardless of their purposes will be noted on your report as well. And if you have ever been the subject of a foreclosure or you have filed for bankruptcy or even if you have tax liens this information will be on this credit report.

You are permitted to receive one copy from each of the credit reporting agencies at no charge each and every year. It is a good idea to get your report from each company because they may have different information on them. All you have to do is ask for a copy and they will send it to you right away. In order to get your free credit report all you need to do is visit http://www.annualcreditreport.com/ and there you will be directed to the different credit reporting companies. The information that you will want to have ready to provide is your name, address, Social Security number, and date of birth. Keep in mind that http://www.annualcreditreport.com/ is the only place that is authorized online to provide you with your credit report. By getting your report from this site you know that you are not taking part in a scam that will end up costing you money in the long run. There is only one other time that you are eligible to receive a free credit report and that is when a company takes action against you. If some company denies you credit you have a right to see your credit report in order to figure out what the problem was and fix it.

Your credit report has a credit score on it and this score is what will determine whether or not you get approved for a loan or more credit. This score is also what will determine what your interest rate will be when and if you do get approved for any kind of credit.
It is the responsibility by law of the credit reporting agency to correct and false or inaccurate information on your credit report. If you ever see anything that you are unsure about on your report be sure to report it immediately. You should first give your credit card company a telephone call and then follow up with a letter explaining the problem. If you have any documentation pertaining to your claim be sire to attach copies to send along as well. Never send the originals, those you need to hold on to. Ask the company to correct these errors as soon as possible. When they respond to you be sure to file these responses away someplace where you will be bale to find them again with ease if you need to. They should respond to your claim within 30 days of the receipt of the letter that you sent so mark down this day.

Once the error has been corrected you have the right to ask that your corrected credit report be sent to all those who have requested it in the last 6 months.

If you credit report is in terrible condition not because of any errors on your report but because of your unreliability with credit then you need to take some steps to deal with your credit. One of the easiest ways that you can take control of your credit trouble is by budgeting. You can plan your budget any way that you want although it is a good idea to not make your budget too strict right off the bat. This could lead to you abandoning it altogether. A good way to plan your budget is to first keep track of all your expenditures. Write everything down and then at the end of the month take stock. This list will give you a good idea of where you can cut down and what you can cut out.

If your biggest problem is coming up with enough money to pay your credit card bills then you should consider giving your creditors a call. It is far better to let them know about the problem than it is to simply not pay them at all. They may be willing to work out a better payment schedule for you. This might even keep them from raising your interest rate.

If you are past the point where your creditors want to deal with you and you have already been passed off to debt collectors you need to know your rights. Legally debt collectors cannot call you before 8 am or after 9 pm, nor can they call you at work unless you have previously given them permission. And if you feel you are being harassed by debt collectors all you have to do is send them a written request to stop contacting you and they must honor this request.

One of the options that you have is debt consolidation. Debt consolidation is a good option for those who are looking for lower monthly payments. This not too bad of an idea because at least this way you will be able to make your payments without further damaging your credit. The one thing to keep in mind is that when you consolidate your debt it will be taking you longer to pay them off. The longer it takes you to pay off the loan the more you will end up paying in interest. You can use lines of credit to consolidate your loan but if you do this you will most likely be asked to put up your home as collateral. If you default on these payments then you will lose your house.

One of the most important things for you to learn is that you are in a prime position to be taken advantage of. Millions of people just like you get fleeced each year by falling for scams that promise to fix your bad credit or erase it entirely. None of these promises are worth as much as the paper they are printed on because there is nothing that can be done to simply erase bad credit. All you can do is work to improve your credit and depending on how bad your credit is this could take some time. Make sure that you look into any company that you are considering working with. A good place to find information is your local better business bureau.

Many of the credit scams that are out there can actually land you in hot water with the law. Some of these companies will charge you money up front and then they will proceed to teach you how to erase your debt history. In fact you are not erasing anything, only creating a new credit identity, which is illegal and punishable by jail time.

Your credit report can be damaged by others besides you and knowing this and how to prevent it is important to your financial welfare. Identity theft is getting to be more anymore prevalent all of the time. It does not take much for someone to be able to steal your entire identity. All they need to do is get a hold of some of your personal information. Some of the most common ways that others steal your identity are by stealing information about you that they come across on the job or by talking someone else on the job to give them your information. This can happen by them paying off an employee or perhaps they already have a previous relationship with an employee that they can use to get such personal information. Hacking into computer records in order to steal personal information is also very common. In this day of computers and technology anyone can learn how to hack into just about any company or network.

Going through others trash is another one of the more common techniques that identity thieves use to gain access to your personal information. We are always getting offers in the mail, many of them pre approved and all it takes is for someone to get a hold of one of these little pieces of paper and they can take over your life. They can then go on to destroy your credit rating and history. You should always shred any and all of these offers that you receive in the mail to avoid identity theft.

Another way to avoid identity theft is for you to keep your credit cards in a separate place from your wallet. This way if a thieve steals you wallet all they are getting is your cash. While it is never fun to have your cash stole at least this will not destroy your entire life. Losing your credit cards to an identity thief can destroy your life. Your credit report is accessed by employers and even landlords these days and if your credit report is in really bad shape you could find yourself without a place to work or a place to live. This is why you should never write down your credit card numbers or your bank account numbers where someone could find them and why you should get a copy of your credit report each year.

If you think that your identity may have been stolen there are some things that you can do. Putting a fraud alert on your credit cards is a good idea and it can save your credit rating. All you have to do is call the credit reporting companies and let them know that you would like to get a fraud alert on your credit report. Getting copies of your credit report from all of the major credit reporting companies will help you to see if there has been any fraudulent activity. The next step is for you to contact your local police station. Let them know what has happened to you including all detail about how it could have happened. You will then want to contact the FTC and fill tem in on what has happened to you as well.

About the Author:

Robert Paisola is an international motivational speaker, trainer and author. He is an expert in the field of Personal Real Estate Investor Training. He is a professional speaker who has been featured on CNN, CNNFN, and the Wall Street Journal.

He can answer your questions on the "Basics of the Real Estate Investing Business" to detailed issues regarding your specific transactions. Life Experience Robert Paisola is a Professional International Seminar Speaker in the Areas of Real Estate Investing, Tax Lien Investing, Rental Property Management, Real Estate Coach and Mentor Training and Business Management. He has served companies throughout the world.

If you are interested in learning the business from someone like Rob email his office at robert@trumpworldwide.com or call our offices Nationwide toll Free 1-877-517-9555 or visit www.allexperts.com/displayExpert.asp?Expert=38419Article Source: EzineArticles.com/?expert=Robert_Paisola

New credit scores supposed to help lenders facilitate loan pricing

2006-04-23T19:23:00.000-06:00

Just when you thought that you were beyond the problem of needing to achieve higher letter grades for your “permanent” record, here they come again! Yes, now you will have the pleasure of being “letter graded” from cradle to grave.

A new credit scoring system is being introduced that reduces the previous FICO number to an alternative letter grade (A, B, C, D, F) — or VantageScore(SM). In a time when interest rates seem to have an upward trend, the higher our credit score (no matter which method is used), the more justification we have to argue for lower interest rates and higher loan amounts from lenders. This article discusses the new system and how it relates to the more-established FICO score.

The goal of all credit scores is actually to facilitate loan pricing and securitization for lenders that do not retain credit exposure on their loans. Defaults on loans create losses that are spread across all loans, so we all benefit from low default rates. Those with poor credit do not usually qualify for much credit and the interest rate they pay is usually higher than the rate paid by those with top credit ratings. Many studies exist showing a high degree of correlation between default rates and credit scores. This is not always true in individual cases because some borrowers are better at negotiating both loan amounts and interest rates with various lenders.
The three major credit bureaus (Equifax, Experian and Trans Union) currently emphasize the Fair Isaac Corporations FICO score to establish our credit status. If you have used these agencies, you have probably noticed that they do not produce the same score/number.
The key FICO factors are: (1) Payment History — about 35 percent, (2) Amounts you owe — about 30 percent, (3) Time you have had an established credit history — about 15 percent, (4) Types of credit you have used — about 10 percent and (5) History of attempts to establish additional credit — about 10 percent.

Note that the score calculation only considers items on your credit report whereas lenders look at other factors such as employment history, level of income and type of credit you are seeking. Everyone should keep informed about their credit reports and seek to remove incorrect information as soon as possible. Improvements in FICO scores can be achieved over time by (1) avoiding late payments/collections activities, (2) reducing credit card balances (canceling them can have a negative impact), (3) avoiding too many applications for credit while maintaining sufficient credit for your needs.

FICO scores range between about 300 and 900. The median FICO score is around 720; scores above 725 are considered “good” while scores below 600 are considered “bad.” In theory, the higher the number, the greater the amount of credit you can obtain and the lower the interest rate. Report any credit report errors to all three credit agencies: U.S., Equifax (1-800-685-1111), Trans Union (1-800-916-8800) and Experian (1-888-397-3742). These agencies have procedures in place to help you maintain an accurate report.

Note that in the list of key factors, your credit history and the amount of time credit has been established play a significant part (approximately 50 percent) in the calculation of the FICO score and employment history is a part of the lender’s decision. What if you are essentially “new” to the work force and you have not established a credit/payment history? One criticism of the FICO score is that it does not provide for those that are beginning the long road of credit management. It is anticipated that the new VantageScore system will provide more support for those in this situation.

Introduced in March jointly by the top three credit rating agencies (patent pending), VantageScore(SM) is not expected to have an immediate impact on credit decisions. In time it will become the first rating system that applies consistent analysis across all three companies. This will reduce differences in ratings between agencies to differences in data files rather than model interpretations of data. Since it was developed using the credit histories of approximately 15 million consumers, it provides for those that are new to obtaining/managing debt, improving the chances of obtaining debt at lower costs. Letter grades for the VantageScore system are produced as follows: A901-900, B801-900, C701-800, D601-700 and F501-600.

As we manage the quantity and cost of debt over time, this new system will probably become another factor used by lenders.

Consumer Advocates Have Mixed Reaction to New Credit Scoring System

2006-04-22T18:50:00.000-06:00

Consumer Advocates Have Mixed Reaction to New Credit Scoring System

By Lydia Verret, CardRatings.com Reporter

VantageScore(sm), a new credit scoring system, was recently jointly introduced by the three leading consumer credit reporting companies, Equifax, Experian and TransUnion. VantageScore is designed to simplify and improve the credit process for consumers and creditors with a more consistent and objective approach to credit scoring.

According to proponents, this new scoring model is supposed to utilize patent-pending analytic techniques to compare the differences in the three credit files (from the three major credit reporting companies) to provide consumers and businesses with a highly predictive and consistent score, which will be easy to understand and apply.

Consumers and creditors will recognize the following score groupings in VantageScore’s new credit scoring scale:• 901-990 A• 801-900 B• 701-800 C• 601-700 D• 501-600 FReaction from many consumer advocates has been mixed. Scott Bilker, author of Talk Your Way Out of Credit Card Debt! notes:

“Clearly, this is a new way for the credit bureaus to make more money selling information about us. Selling it to lenders, insurance companies, and to consumers. Of course, that information could help us, or hurt us, depending on how and why it's used. The good news for creditors is that it easier to have a single score instead of analyzing different scores.”

Time will tell if the new VantageScore system will replace the popular FICO credit scoring model that has been around for many years. According to Gerri Detweiler, a noted consumer educator and author of The Ultimate Credit Handbook:

“VantageScore(sm) is competition to FICO scores, but lenders tend to be somewhat slow to adopt new scores. In addition, I don’t expect the mortgage industry to quickly replace FICO scores with VantageScores. Competition, in an of itself, may not be a bad thing here."

VantageScore is now commercially available. It is being marketed separately by Equifax, Experian and TransUnion through licensing agreements. We welcome your comments about credit card and money issues in our popular credit forum!

Lydia Verret has been a reporter for CardRatings.com for approximately a year, but has had a passion for writing for many years. Her writing career begin in high school as roving reporter for her school newspaper and yearbook. She is a proud mother of two daughters, one of which currently writes for her school paper, and resides in Memphis, TN. She also is proud to married to a firefighter who is quite the handyman.

CardRatings.com is the most comprehensive source for comparing credit card offers. CardRatings.com is pleased to offer consumers free credit card ratings.

Credit scores: Where confusion abounds

2006-04-18T20:48:00.000-06:00

Just when we get used to the idea of credit scores and each credit bureau having its own version, here comes yet another version. But first, let's review:

In the beginning, there was Fair Isaac, the firm that invented a mathematical formula that creates an individual's three-digit FICO score, which supposedly measures how much debt a consumer is carrying and how well the consumer keeps up with bills. The higher the score, the better risk that person represents.

Experian, Equifax and TransUnion are private companies that track individuals' credit accounts and payment habits. Not wanting to be left out of the lucrative credit-scoring business, each created its own brand of credit score, licensed the FICO scoring model to create its individual "brand" and made the scores just different enough to become very confusing. One bureau's scores can go as high as 900, while another tops out at 820. That means a score of 780 could be marvelous with one agency but rather average with another.

Several weeks ago, the credit bureaus announced they are banding together to come up with an all-new, uniform credit score called VantageScore. The reasoning is, this new VantageScore will be easier for consumers to understand and will make things more consistent for lenders. Of course, they refer to the "confusion that abounds" in credit scoring as their motive. I don't buy it for a moment. I see the bureaus creating a new income stream because, without a doubt, this is a new product for which they will charge dearly.

In its announcement, Experian said the new VantageScores will be grouped on "the familiar academic scale."

A - 901-990
B - 801-900
C - 701-800
D - 601-700
F - 501-600

Of course, there will be a hefty charge to get one's VantageScore, and I'll wager it will be more than a onetime event. They will want to sign us up for monthly credit-score monitoring or some such thing.

While I cannot comment further on the VantageScore until I see it, I can advise that unless you are planning to apply for a mortgage or other secured financing within the next couple of months, don't worry about your credit score. You don't need to know what it is. Instead, keep your eye on your credit report - free once a year from each of the big-three credit bureaus. Go to http://www.annualcreditreport.com/ to get your free reports, and make sure only correct information is reflected in them. Then pay your bills on time. All of your bills, all of the time.
On the rare occasion you need to check your credit score (in anticipation of applying for a mortgage would be a good reason to check it), go to http://www.myfico.com/. This is the score that most lenders look to and the one most widely respected.

Take care of your financial affairs in a responsible manner, and your credit score will take care of itself.

Change adds to credit score confusion

2006-04-15T18:21:00.000-06:00

POSTED TO MYCOLLECTOR.COM by ROBERT PAISOLA

One thing that definitely befuddles many consumers is the credit-scoring system.

And things got a little more confusing when the three major credit bureaus -- Equifax, TransUnion and Experian -- recently announced they had joined together and created their own branded creditscoring model, which they hope will replace FICO, the one now widely used by lenders.

Right after the announcement, my e-mail in box began filling up with questions from readers about credit scoring.

The FICO credit-scoring system, developed by Fair Isaac Corp., rates consumers on a scale of 300 to 850. The VantageScore system created by the credit bureaus uses a scale that ranges from 501 to 990. The bureaus' version is supposed to approximate a letter-grade system. Scores of 901 to 990 would be the equivalent of an A; 801 to 900 a B; 701 to 800 a C; 601 to 700 a D; and 501 to 600 an F.

"It appears now that someone with a credit score of, say, 800 under the current system, certainly top of the line, since 850 is the current ceiling, would move from a top rating to average under the new system," one reader wrote.

That's an incorrect conclusion. The two systems are not being merged. High scores under the FICO model remain high. It is more likely that if you have credit scores in the 800s under FICO, you'll score in the 900s in the VantageScore system, assuming the bureaus use the same or similar factors to determine people's credit worthiness.

The announcement about VantageScore also gave folks a chance to vent about errors in their credit files.

"Suppose a credit bureau reports information that is incorrect. Why wouldn't this be legally actionable? Why can't I sue?"

Actually you can. Under the federal Fair Credit Reporting Act, the credit bureaus and businesses that supply them with data are obligated to correct inaccurate information. The act is supposed to ensure the accuracy of information contained in your credit files maintained by the credit bureaus.Correcting errors on your credit report can be maddening.

The problem is that in trying to verify information, the bureaus simply go back to the source. And guess what the creditors often do? They simply confirm the incorrect information in their databases.

If you find an error in any of your credit reports, the Federal Trade Commission says you should write to each agency requesting a deletion or correction. Your letter should clearly identify each item in your report that you dispute. You should also enclose a copy of your report with the items in question circled. Include copies (not originals) of documents that support your position. And finally, send your letter by certified mail, return receipt requested, so you can prove that the credit bureau received the information. Also, keep records of everything and everyone with whom you talk.

But before you do all that, contact the creditor that supplied the incorrect data. You have to attack the erroneous information at the source. If you can clear it up with your creditor first, you have a better chance that the error won't be transmitted again.

The law requires credit agencies to investigate disputed information and correct inaccuracies within 30 days of hearing from a consumer.

If you don't get satisfactory action from the credit bureau or creditor, you have at least two recourses. You can complain to the FTC. Unfortunately, the commission doesn't get involved in resolving individual consumer problems. However, your complaint might lead to some law enforcement action.

Your second option is to file a lawsuit. You can sue in state or federal court. In some cases, you may have more rights under state law. For more information, contact your state or local consumer protection agency or your state attorney general's office.

These types of cases are not easy to win but if you have a particularly egregious situation, go for it. To find a lawyer, try the National Association of Consumer Advocates. Their Web site, www.naca.net, lists consumer lawyers by state.

Finally, those of you with great credit scores -- 720 or higher -- stop obsessing. You don't need a perfect score to get the best credit offers.

Whatever credit-scoring systems lenders use, continue to question what you don't understand. After all, your scores directly translate into real dollars.

ABOUT YOUR MODERATOR:

Robert Paisola is driven by a passion for people motivating them to reach their top potential and has been the director of Many International Corporations, Robert trains sales and marketing professionals who want to strive to get to the top...and stay there.

His innovative, no-nonsense approach is based on applying what he has observedin his fifteen-plus years in sales, motivational speaking andtraining,thus revealing the common business habits of the top 20% of salesperformers in all organizations.Robert's approach works...that's why New York-based Success Magazine has rated Robert Paisola as one of the top-five most effective sales-training professional in the market today. Routinely Distinguished by The NationalSpeakers Forum, Robert is also a regular contributor to Business Week Magazine, CNN, CNNFN, XM Satellite Radio, The Wall Street Journal,Telemundo International, National Public Radio and many other organizations. For more information on Robert Paisola’s unique training programs, contact Robert at Western Capital at robert.paisola@mycollector.com or at 1-877-517-9555 or visit Robert's Media Access site located at: http://www.expertclick.com/19-2637

Robert Paisola, owner of VantageScoreFacts.com issues Release

2006-04-12T12:45:00.000-06:00

We Can Guarantee that you have NEVER Experienced this type of Program in your life! On-Site Crisis Management Like You Have Never Seen Before! LISTEN TO THE LIVE CALLS AT THE END OF THE PAGE!

You will need to visit www.mywesterncapital.com/structure1.html to see the site and listen to the calls.!

Updated 4-10-2006

Western Capital has pioneered methods that enable debtors to satisfy creditors while retaining the cash flow necessary to stay in business and recover.Western Capital and it's CEO, Robert Paisola hahave helped thousands of businesses get out of debt and sends millions of dollars to creditors annually. Western Capital bridges the financial gap between struggling businesses and their creditors.By developing affordable payment plans and negotiating acceptable terms with creditors, Western Capital provides its clients with the best chance of survival. This also gives creditors the best chance of being paid. Our program works because it is fair to all parties involved.Some highlights of our company are as follows:

We have consistently provided creditors with the best attainable payment options given the debtor's ability to pay.

Our employees are all veterans of the debt collection and debt restructuring industries.
They have successfully settled over 10,000 debts on behalf of debtors and creditors alike.
Our CEO, Robert Paisola, is an Expert in the areas of Debt Collection and Business Credit Collections, So, who better than another collector to battle YOUR CREDITORS!
What We Do to create a Win-Win with your Creditors

With the help many experienced credit professionals, we have developed a unique and systematic method for satisfying creditors with affordable installments that you determine. Our On Site Program will deeply analyze each client's financial condition in order to structure the best available program that not only meets your needs, but also the needs of your creditors.Our strategies for securing assets (CALLED ASSET PROTECTION) will often deter creditors and their pit-bull attorneys from proceeding with additional collection activities and will increase the motivation to settle. No longer will aggressive creditors have the ability to exhaust a debtor's resources. And we will free up your staff's time of answering calls that are impairing your ability to make money.

The collection Calls go to us! Call 1-877-517-9555 and act like a pissed off collector, and see what happens! Yes, you too can have that service!Since this is a very unique service and getting out from under the mess that has been created over time, We highly recommend that Robert Paisola spend at least one week at your location. He will work with your people and review all of the facts and figures to come up with a "game plan". It will require the full attention of the CEO and the entire management team to make this happen, but one thing we can tell you is that we understand how is to be the day before payroll and be 30K short.

Many people believe that the methods that we use to protect you and your company are aggressive.... Well they are!

We are paid to PROTECT YOU and YOUR COMPANY! And believe us when we say that we have seen it all. The good news is that we rarely deal with your attorneys. They get paid to CHURN DOCUMENTS. We do not play the game that way. Call Robert and he will explain how it all works. The collectors who are after you and causing you to have sleepless nights will regret the day they met us.

Just think about this... Who else can possibly be better at dealing with creditors and collection attorneys and agencies, than another collector. That is where the game ends. That is where your stress ends.

We also understand the importance of keeping your important supply lines open with certain priority creditors. If a debtor includes creditors that are vital to the business, we will make every effort to ensure that an ongoing relationship is part of the settlement. Basically this is the "communication side" of the workout. That will be done at your offices most of the time.When we are finished working with you, You will have no question as to the amount of money Your Company needs weekly to stay afloat, because the monthly cash requirement is predetermined based on our analysis of your companies financial condition. By converting short-term debt into manageable long-term payouts, we can increase your immediate cash flow NOW!

HOW OUR PROGRAM WORKS FOR YOU AND YOUR COMPANY

Our goal at Western Capital is to develop a plan that you can afford and creditors will accept. The program works as follows:

Call us IMMEDIATELY and ask for Robert Paisola (especially if there are IRS GARNISHMENT ISSUES or LAWSUITS)

Fax us a list of your problem creditors to 408-889-2415, we will run a preliminary analysis on the problem.

We will then look at your cash flow and see if it financially makes sense to have Robert come to your business,

We agree on a fixed price for the onsite visit, The price varies based on where you are located. For instance if you are in Detroit, the price will be different than if you are in Miami or Dallas. Its all about the convenience and destination of where you are located.

You use your built up stash of miles to fly Rob to your location and set up the hotel and "activities"

The CEO and President or Owner will meet in the lounge at the hotel and have a brainstorming session and you will lay out the confidential facts of your issues. EVERYTHING is COMPLETELY CONFIDENTIAL!

Voila, the next day, Robert Paisola shows up at your office and all hell breaks loose! So if you have employees who are not used to an ADHD Type A Personality,,, You might want to prepare them.

We will review all of the files and invade the Accounts Payable Office. We will devour the box of unopened mail that is sitting in the corner because it is all bills and you did not want to have to deal with it.

Next, we will start calling the SECURED creditors who you are PERSONALLY LIABLE for payment on. We will make this the top priority (along with payroll)

We will all go to lunch daily and we will discuss the project with your team. Some people will be PISSED. Some will be AMAZED. So, be prepared!

Unsecured creditors are always the last priority and we straight out tell them that, You can not conceive the POWER that you have when we are at your location and your creditors are folding like ducks in the water.

Next comes the PLAN, that is where we will set you up with a cash allocation analysis. You will be required to create the BUY IN from your employees so that they can see that things are changing, Rob will give you direct feedback on who is the dead weight in the company. Lets hope it is not your wife, but he will tell it like it is!

By the time the 4 days are over, you will no longer require Valium or Lortab just to Function. You will have a plan of attack and you will have a number to give all the creditors. That is what we get paid to deal with. You simply say "I am so sorry Jennifer, I know we owe you 110,000 on that invoice, but all of our finances are being CONTROLLED by a company called Western Capital. Give them a call.... And have a nice day!

Once Robert arrives back in Salt Lake City, Utah his team will devour your data and you will have direct access to Rob at a reduced rate, unless you become a pain in the ass, and then the fee doubles.

Bottom Line... You have no choice. If you have read this far, You need our help and we GUARANTEE that NOBODY ELSE will play the game the way we do. That is why Robert Paisola is an international Expert in Credit and Collections, just look at http://www.allexperts.com/displayExpert.asp?Expert=38419 and http://www.expertclick.com/19-2637

So, just do what comes natural and call Rob Today at 1-877-517-9555 and if the staff plays games with you on getting through to him, tell them to patch you through because you are a CLASS 120 CASE

One final rule. You must be honest. We are not the FBI, The CIA or the IRS, WE COULD CARE LESS WHAT HAS HAPPENED IN THE PAST. IF YOU ARE BEING INDICTED, WE WILL DEAL WITH THAT ALSO. YOU CAN NOT JUST PAY TO HAVE US COME ONSITE AND HAND US OFF TO ONE OF YOUR PUPPETS. ARE WE CLEAR?

Now, Try and find someone who will do that!

(These are unedited calls, you may want to wait for the call to start or right click and save)

LISTEN TO A CALL WITH "THE GATEKEEPER" FOR THE CEO WHO IS AVOIDING OUR CALLS ON A PAYROLL COMPANY MATTER
LISTEN TO CALL NUMBER ONE The Car Deal From Hell Part 1
LISTEN TO CALL NUMBER TWO The Car Deal From Hell Part 2
LISTEN TO CALL NUMBER THREE The Car Deal From Hell Part 3
LISTEN TO CALL NUMBER FOUR WITH ALLIED INTERSTATE (THE RUNAROUND)
LISTEN TO CALL NUMBER FIVE WITH ALLIED (LISTEN TO THE COLLECTOR-LISTEN TO HOW ROBERT PAISOLA CONTROLS THE CONVERSATION)
LISTEN TO A CALL WITH A CONSECO COLLECTOR WHO IS COMPLETELY LOST AND IS CAUGHT IN A LIE REGARDING OUR CLIENTS CREDIT REPORT
LISTEN TO A CALL WITH A WELLS FARGO COLLECTOR ON LAWSUIT (PAISOLA PLAYS THE GOOD GUY DISCUSSING THE MORAL ISSUE vs. LEGAL) LISTEN TO HOW THE COLLECTOR GOES NUTS AND WE ARE CALM! FORECLOSURE The Collector Hangs Up On Rob!

OK, OK THE FEE IS SOMEWHERE AROUND $7,000 TO $10,000 PLUS EXPENSES (MO MOTEL 6, OK?) AND WE BENEFIT FROM THE GRAVY MONEY ONGOING AS WE SETTLE YOUR CASES, THE CALLS STOP AND WE MAKE YOU MILLIONS!

Now print this out and have your legal department read this! Just watch their Faces! Call Rob at 1-877-517-9555 NOW and also email with your information at robert.crisis@mycollector.com

The Vantage Score Development Timeline

2006-04-06T04:47:00.000-06:00

3/15/06
Secret VantageScore - "The New Standard in Credit Risk Scoring"

The scale is 501 to 990. In the Robert Parker wine scale, you get 50 just for showing up.

The official FAQ

Apparently, "How can I get my score?" is not asked frequently.

That's probably because-- with our prior experince-- we already know their response: Go away, you can't have your score.

Terry Savage, Chicago Sun-Times: "Equifax says it'll wait until lenders accept this new score before marketing it to consumers. That's expected to take at least six months."

Caroline Mayer, Washington Post: It doesn't predict anything until lenders say so.
"The new scoring system will not be valuable to consumers 'unless the credit grantor adopts and uses it,' said Paul J. Springman, chief marketing officer for Equifax. He said his firm would switch as soon as lenders accept the new system. 'That will take more than six months,' he said."

Background
Internet domain
vantagescore.com domain was registered by "Trans Union LLC" on January 30.
Two-year commitment: expires 2008 (by contrast, creditaccuracy.com and creditscoring.com are registered through 2012).

Corporation: "VANTAGESCORE SOLUTIONS, LLC" was incorporated in the state of Delaware exactly one month before the official announcement of the company's existance. File number 4109899.

Who's who

TransUnion: "Chet D. Wiermanski is vice president of TransUnion’s Analytic Decision Services group responsible for identifying, evaluating and developing new business opportunities involving predictive modeling and related consulting services."

A virtual company; no physical address on its web site, no president.

Press releases
vantagescore.com

TransUnion
Joint release; dateline in alphabetical order

"VantageScore(SM) To Set New Standard For The Marketplace - TransUnion Says - New Score to Fill Void of Consistency and Choice in the Industry"

Equifax

Joint release

It's another secret forula, so you'll just have to take their word for it, again. "No other model does a better job of delivering objective and consistent credit scoring."

Experian

Joint release

"Experian launches new credit scoring system, VantageScoreSM" - "The new scoring system addresses the potential weaknesses in existing scoring solutions in the marketplace because any variances in credit scores between credit reporting companies will be attributed to data differences within each of the three consumer credit files and not to the structure of the scoring model or interpretation of the data."

The Wizard speaks

Kathy M. Kristof, Los Angeles Times

"Ron Totaro, vice president and general manager of global scoring solutions at Fair Isaac, said the credit-reporting companies 'have all had their own credit scores that they have tried to sell against us, and they've been wildly unsuccessful. This is them trying to take another crack at our fortress.'"

Eileen Alt Powell, Associated Press: "'Do the customers . . . really want to go through the pain of converting to another system?' [Fair Isaac's] Grudnowski asked. 'I think only time will tell.'"
Jean Chatzky: "Stephen Brobeck, executive director of the Consumer Federation of America, said the new score will create problems... 'It's a terrible idea.'"

Matthai Chakko Kuruvila, San Jose Mercury News: "The changes in credit scoring underscore the intimate way credit lives with consumers as a measure of self-worth."
GIGO, Businessweek Online, Peter Coy

"... VantageScore can't overcome the problem of incomplete or inaccurate information. "Garbage in, garbage out," says Greg Fisher of Dayton, Ohio, who runs two web sites on the subject, creditscoring.com and creditaccuracy.com."

Christopher Conkey, The Wall Street Journal:

"Atlanta-based Equifax says annual revenues for its "personal solutions" division, which sells consumers credit scores (used by lenders to assess risk and set interest rates), reports and monitoring services, jumped by more than 60 percent to $115 million over the last two years, outpacing the 19 percent rise in its $800-million-a-year division that sells credit information and risk-assessment tools to businesses."

WWW.ROBERTPAISOLA.COM

No Credit Except for the Hype

2006-04-06T02:01:00.000-06:00

No Credit Except for the Hype

By CATHERINE MacRAE HOCKMUTH
Thursday, March 30, 2006

We, as consumers, have always had three different credit scores to present to people who may lend us money or a line of credit. That's because there are three consumer credit rating agencies.

Those three agencies have recently unveiled a new unified scoring system designed to bring consistency to the process of borrowing and lending.

This is supposed to be a good thing and they keep telling us it is, but they won't tell us why. Unfortunately, the bureaus won't disclose how the new system calculates scores so we're stuck with only their hype.

Your credit score is a number designed to give banks an idea of how risky it is to lend you money. The score is based on your credit history: whether you've made a lot of late payments or routinely max out your credit cards. Or, on the positive side, maybe you've never missed a payment and only use credit cards for things you could pay for in cash.

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The new VantageScore will compete with the long-revered FICO score by Fair Isaac Corp., though, again, we have no idea how the scores compare because the bureaus won't release their algorithm. VantageScore pairs score ranges from 501 to 990 and the familiar academic scale of A to F, presumably to make things really simple for consumers.

-- 901-990 equals an A
-- 801-900 equals a B
-- 701-800 equals a C
-- 601-700 equals a D
-- 501-600 equals an F

So when you're kid comes home and says, 'I've got an A' in home economics you can say, 'Me Too' -- hopefully.

Maxine Sweet, vice president of public education for Experian, said in a press release that credit scoring is the hottest topic among consumers seeking credit education materials. A unified scoring system means consumers can get a clear picture of their credit worthiness instead of having three different scores.

There's a big but here: the main reason one person can have three completely different scores under FICO is because not all creditors report payment history and account information to every bureau. So while Experian might know that you're 60 days late on a car payment, TransUnion may not.

VantageScore does nothing to improve this problem and it doesn't appear that the credit bureaus are focused on the issue of data inaccuracy. So you could still have three different credit scores. Where's the advantage?

The scorers say that consumers can rest assured that the three companies have judged their credit differently not because of the fact that they are different companies that use different scoring formulas but because they receive different information about the person involved. According to a joint press release from the bureaus, scoring differences can no longer be blamed on them but will be attributed exclusively to these data differences.

What they actually said was: "The new scoring system addresses the potential weaknesses in existing scoring solutions in the marketplace because any variances in credit scores between credit reporting companies will be attributed to data differences within each of the three consumer credit files and not to the structure of the scoring model or interpretation of the data."

Isn't that what I just said in English?

If they really wanted to do consumers a service, why not spend some time and resources to ensure that the information they receive about someone is accurate?

Not going to happen. Steven Katz, director for consumer communications at TransUnion, told me consumers must review their credit files and contact creditors regarding inaccuracies. And he said it wasn't a problem: He pointed to a 2004 study by the Federal Reserve Board that found inaccuracies in a credit file don't necessarily affect an individual's ability to obtain credit.

But with predatory lenders willing to offer credit to just about anyone these days, the question isn't so much about whether credit will be granted, but at what rate. That's why it's important for the score to be reflective of accurate information. If you have three different scores, mortgage lenders, for example, generally go with the middle one.

The new scoring system may be the best thing to ever happen to credit scores, but without information we're left with hype. What we do know is that the bureaus got together, agreed on a common system and gave it a marketable name. VantageScore certainly sounds like something that might give you an advantage.

The score is a pretty big deal because the higher it is, the less you pay for the privilege of accessing lines of credit regardless of whether you're buying a home or a cell phone. For example, a person with a credit score between 760 and 850 -- the highest under the FICO system -- will pay $319 less per month for a $216,000 30-year-fixed rate mortgage than a person with FICO scores below 620. That's nearly $4,000 a year just because you never pay your bills late. Fair Issac Corp.'s calculations were based on the best interest rates available at press time.

And it doesn't matter how much money you make or what kind of job you have. Just pay your bills on time and your score will rise. There are a few other factors, but payment history counts for 35 percent under FICO. How much debt you have counts for 30 percent, length of credit history counts for 15 percent of your score. New credit such as the number of recently opened accounts and credit inquiries account for 10 percent of the score. The type of credit accounts for another 10 percent.

Regardless of the system, there are some surefire ways to raise your score:

-- Keep balances low on credit cards
-- Pay off debt rather than moving it around
-- Don't close unused credit cards as a short-term strategy to raise your score it may raise your debt-to-income ratio
-- Don't open a number of new credit cards that you don't need just to increase score - this approach could backfire
-- Don't open a lot of new accounts in a short time
-- Closing an account won't make it go away.
-- Go rate shopping for a loan within a set period of time. FICO scores consider multiple inquiries for a car loan, for example, as a single entry as long as they're within a certain time period.
-- Checking your own credit won't affect your score so check your credit report at least once a year and correct errors.
-- Pay your bills on time, always (this can't be overemphasized so if you're forgetful, set up automatic bill payments or make a date with yourself to pay bills online. It only takes a few minutes and will save you lots of money.

Media Advisory: Free Teleconference on New VantageScore (SM) to Discuss Implications for Brokers and Borrowers

2006-03-31T15:45:00.000-07:00

Media Advisory: Free Teleconference on New VantageScore (SM) to Discuss Implications for Brokers and Borrowers

Advantage Credit will host a free teleconference with a panel of mortgage industry experts on April 4, 2006.

Pensacola, FL (PRWEB) March 31, 2006 -- What: Advantage Credit, a top-10 mortgage credit reporting reseller, will host a free teleconference for its 18,000 mortgage broker customers and media regarding the announcement of VantageScore (SM), a new credit scoring model introduced unexpectedly two weeks ago by the three credit bureaus.

This event will provide the opportunity for a panel of industry experts to share their opinions on the new score and its possible effects on the mortgage business and consumers. When: The event will take place Tuesday, April 4th from 1 p.m. - 2 p.m. ET / 10 a.m. – 11 a.m. PT

Who: Ron Litt, president of Advantage Credit (formerly SVP at Allied Home Mortgage Capital Corp.) will be hosting and moderating the conference.

Panel Speakers:Representative from ExperianDan Jacobs, president, 1st MetropolitanRob Carter, senior VP of Amstar Mortgage More panel members to be announced

Why: The announcement of the new score by Experian, Equifax and TransUnion raises questions that have implications for everyone in the mortgage business. Many brokers are concerned about the announcement and what it means for their customers. The panel will address the expected level of acceptance into the industry, score consistency issues, pros and cons for borrowers and questions from the listeners via live e-mail.

To register for this free teleconference, call Amber Jackson for at 800-600-2510 ext.2471 or via e-mail at e-mail protected from spam bots.

Special Q & A OpportunityHave questions about VantageScore (SM) for our panel of experts?

Send them in advance to e-mail protected from spam bots.The teleconference capacity is limited so register now.

An audio file will be available online after the teleconference is held.

Advantage Credit: We do moreBackground:

About Advantage CreditAdvantage Credit International is the fifth largest credit reporting agency in the industry and is at theforefront of the fight against mortgage fraud. The company not only provides the easiest-to-read credit reports in the industry but also offers products and resources that save time, lower costs, close more loans and prevent fraud, doing more to aid loan officers. Advantage Credit serves more than 8,000 mortgage brokers and other customers nationwide through its customer-centric order and delivery site, Advantage Online and is a five-time Inc. 500 “Hall of Fame” winner.

Advantage Credit, founded in 1991, is a wholly owned subsidiary of The Adaugeo Group.Contact:Amber JacksonPR ManagerAdvantage Credit InternationalPh: 800-600-2510 ext. 2471

Get your 'new' credit score before you buy a loan

2006-03-21T16:49:00.000-07:00

‘Today’ financial editor Jean Chatzky explains the new scoring process and offers tips on how to keep your score in good shape

By Jean Chatzky
“Today” financial editor
Updated: 7:46 a.m. ET March 20, 2006
The 'Today' show Financial Editor

Just when you thought you were starting to understand your credit score, the three credit bureaus are throwing a monkey wrench in the works.

Equifax, Experian and TransUnion recently announced that — working together — they are launching a new score called VantageScore. Available to credit grantors immediately and to consumers once creditors start using it, the program, according to a joint press release, is designed to "simplify the credit process for both consumers and credit grantors." They'll do this, the companies explained, by all using the same methodology — the same formula — to compute this one score.

That's not how it works today. Currently, consumers who want to learn their credit score can buy one from any of the three bureaus (which gather credit data) as well as from myfico.com, the Web site of Fair, Isaac and Co. (FICO), the company that first turned credit data into the scores that lenders use to make their underwriting decisions.

Right now, the scores are all computed on a scale of roughly 300 to 850, but not all scores are the same. Your Equifax score is likely different from your Experian score which is likely different from your TransUnion score. All three bureaus use different formulas to compute their scores. But also because not all creditors report data to all bureaus. By using the same formula, VantageScore will solve the first problem, but not the second. Still, TransUnion Spokeswoman Colleen Tunney says: "We think variance in scores will be reduced by 30 percent.

The other problem the new score doesn't address is the issue of consumers having access to the same scores that lenders use. Right now, 75 percent of mortgage decisions are based on an actual FICO score; lenders buy them from Fair, Isaac. Logically, if you're going to be applying for a loan from one of these lenders and want to know what sort of rate you'll be able to qualify for, you should know your actual FICO score as well. That means buying one from myfico.com or from Equifax, the only bureau to sell an actual FICO score.

The bureaus hope is that lenders will see that this new score is so predictive — that it does such a good job of showing which consumers are good risks and which ones are not so good — that they'll start to buy this one instead. If that happens, if VantageScore achieves critical mass, then it should be the one consumers ultimately turn to.

Until then, though, there will likely be another new score in the mix. And consumer advocates already believe it will be problematic. Why? The bureaus have introduced a new scale. Rather than sticking to the SAT-like score where anything close to 800 is a homerun, they've introduced a scale that starts at 501 and ends at 990.

They believe it should be easier to understand because it works like grades in a classroom. Anything from 900 to 990 is an A, which is excellent, anything from 800 to 899 is a B, which is pretty good and so on. Stephen Brobeck, executive director of the Consumer Federation of America, disagrees. "It's a terrible idea," Brobeck says. "At a time when consumers are just beginning to understand the traditional credit score scale, to change it radically will greatly increase consumer confusion."

For now, what should you do if you want to know what your credit score is? Go to myfico.com or Equifax.com and buy one for $14.95, or — if you will be applying for a big loan like a mortgage in the next six months — buy all three for $44.84. (You don't want one low score to sink your chances of qualifying for a good rate on that loan; and it's tough to tell which score the lender will pull.)

Then, do your best to bring that score up by:
Paying your bills on time. Your credit score is numeric representation of how likely you are to be 90 days late to any of your creditors over the next 24 months. Every month you manage to keep your nose clean by paying your bills on time will make you look even less likely to be late in the future and send your score up.

Paying down debt. The percentage of credit available to you that you're actually using — called your "utilization ratio" weighs heavily in your score. Your score will be highest if you are using only about one-third. (Using more than two-thirds is a serious drain on your score.) If your ratio is hurting rather than helping, pay off some debt.

Focusing on credit cards you're closest to maxing out. The scoring companies look not only at how in debt you are overall, but how in debt you are on specific cards. Try to pay off those that are most maxed out first.

Not applying for new credit in the meantime. Every time you apply for new credit, you send your score down a little bit.

Jean Chatzky is an editor-at-large at Money magazine and serves as AOL's official Money Coach. She is the personal finance editor for NBC's "Today Show" and is also a columnist for Life magazine. She is the author of four books, including "Pay It Down! From Debt to Wealth on $10 a Day" (Portfolio, 2004). To find out more, visit her Web site, http://www.jeanchatzky.com/.

WHOIS Search Results for: VANTAGESCORE.COM

2006-03-19T22:50:00.000-07:00

WHOIS Search Results for: VANTAGESCORE.COM

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Finally: New credit scoring system set

2006-03-19T22:45:00.000-07:00

Finally: New credit scoring system set

March 15, 2006

BY TERRY SAVAGE SUN-TIMES COLUMNIST

Remember back in high school, when it seemed your whole life would be determined by your SAT score? Well, now there's a new score that will impact your entire life.

On Tuesday, the three largest credit bureaus -- Equifax, Experian and TransUnion -- announced they have created a new credit scoring system, "VantageScore," aimed at simplifying the loan process for both lenders and borrowers.

Credit bureaus are best known for compiling your credit report. The credit report merely reflects the information collected by the bureau from anyone who has granted you credit or who inquires about your credit.

Your credit score uses a proprietary modeling process, designed to weigh factors in your credit report -- such as the amount of debt you have outstanding and your history of prompt payments.

CREDIT MYTHS

Personal finance experts say the biggest factor in a bad credit rating is poor payment history. Consumers who don't pay their bills or pay them late have lower credit ratings.

Beyond that, nothing else affects your credit score, including these four myths:

Myth 1: Checking your own credit will lower your score. Nope. Check all you want through the credit bureaus.

Myth 2: Your age, income and sex are factored into your score. Nope. Credit-industry experts say your place of employment is on a credit report, but even that doesn't affect the score itself.

Myth 3: The higher the salary, the higher the score. No again. And neither will winning the lottery. Pay off your debts. That will improve your score.

Myth 4: Credit scores are averaged when you marry. No. Your score is your score, and follows you like a shadow.

Credit scores have been around for a long time -- used by businesses to codify the information in your credit report and predict your creditworthiness. The best known name in the business has been the FICO score, so labeled because it was created by a pioneering company in the business, Fair Isaac Co.

But a variety of other credit scoring models have been used by both lenders and credit bureaus. The result has been a bewildering range of credit scores that showed wide discrepancies. Depending on which score was used, you might have been turned down for credit -- or required to pay a higher interest rate.

The solution -- jointly created by the credit scoring experts at all three credit bureaus -- is the new VantageScore that will range from 501 to 990. The higher the score, the more creditworthy the individual is deemed to be.

The VantageScore scoring system was created by taking information about a select, large group of consumers from all three credit bureaus at the same time to create a consistent, standardized scoring formula. It uses a new algorithm for modeling the factors that create the score, a process so unusual that the joint venture has applied for a patent on it.

The joint scoring formula will eliminate discrepancies as wide as 30 percent that currently exist in credit scores. But there still will be some disparities because the three major credit bureaus don't receive exactly the same information. Some credit grantors report your payment history to only one or two of the bureaus. Still, using the same scoring system should provide a lot more uniformity to the process.

Now the challenge is to get businesses to actually use this new VantageScore, rather than the other existing scoring models. It's expected that major credit grantors will quickly start evaluating the new score, comparing it to their existing models. If many agree to adopt VantageScore, that will benefit consumers in the long run.

Equifax says it'll wait until lenders accept this new score before marketing it to consumers. That's expected to take at least six months. But the financial institutions have been requesting a consistent, high-quality scoring model to aid them in their credit granting decisions, and they are certain to make this evaluation a priority.

Each bureau will market the VantageScore in its own way and set its own price. Federal law requires each bureau to give you one free credit report a year. (The easiest way to do that is to go to www.annualcreditreport.com and click on the link to each bureau.) So the credit bureaus will use the new VantageScore, along with their credit monitoring services, as a source of revenue.

It's expected that the credit bureaus will bundle their own, or all three, credit reports, along with the new VantageScore, and possibly a subscription to their credit monitoring service for a fee to be determined. But again, that depends on how widely accepted the new VantageScore becomes.

Since so much of our lives are impacted by how we're viewed by credit grantors, we can applaud the three bureaus for their joint effort. It's time consumers knew the real score. And that's The Savage Truth.

Copyright © Terry Savage Productions

The "Official" Vantage Score FAQ

2006-03-19T22:38:00.000-07:00

Q.
Why have the three companies collaborated to develop a score?

A.
The three companies have heard client demand for the development of a single model that leverages the expertise of all three companies, and delivers the same, consistent and predictive power regardless of the data provider. The only way to address this market demand was to cooperate in the development of a revolutionary new score.

Q.
What are the advantages of this score over the many others currently on the market?

A.
Developed simultaneously from consumer data across all three credit reporting companies, this score promises greater consistency and predictability. Leveraging the deep data understanding of all three companies, and the latest analytic techniques, make this score not only consistent, but more predictive than older models.

Q.
Who will be the main market for this new score- consumers or business clients?

A.
VantageScore was created to address a strong need in the business marketplace. However, each company will distribute the VantageScore in a way that is consistent with its own business strategy that may include both consumers and business clients.

Q.
What does this mean for the continued existence of the credit scores the three companies have developed and marketed individually for the past few years? Will these scores continue to be sold?

A.
This score provides a new and unique option to the marketplace. There will continue to be multiple scoring solutions in the market that meet business needs. VantageScore will compete on the merits of its consistent, predictive power.

Q.
Will each of you sell the same score? Will there be any variations from company to company?

A.
The same model is used across all three companies. Differences in scores will occur when the underlying data content is different. Each company will sell VantageScore according to its unique marketing strategy and positioning in the marketplace.

Q.
How will this new score be priced?

A.
As independent distributors of VantageScore, each company will set its own prices.

No Matter the Formula, Keep Credit Score High

2006-03-19T21:43:00.000-07:00

Personal Finance

No Matter the Formula, Keep Credit Score High

Three reporting bureaus plan a simpler system as a rival to FICO. Regardless, knowing how to get a high rating and keep it is key.

March 19, 2006

The nation's big credit reporting agencies announced last week that they were launching a standardized credit score — with grades from A to F — to make it easier for both lenders and consumers to understand the often misunderstood ratings.

The new VantageScore from Equifax Inc., Experian and TransUnion is intended as an alternative — and competitor — to the three-digit FICO score calculated by Fair Isaac Corp.

But whether your credit score is expressed as a number or a letter, the most important thing is knowing how to establish a high rating, and keep it high.A good credit score makes it easier to get a loan, and can allow you to get credit at a lower cost. A top rating gives individuals access to the lowest-rate loans and the lowest fees, which can save thousands of dollars over time.

Fair Isaac, the nation's leader in credit scoring estimates that there's more than a 1.5% difference in mortgage rates for those at the top of the credit scale versus those near the middle. On a $200,000 mortgage, that difference costs a person with the lower score almost $200 a month — more than $71,000 over the life of a 30-year loan.

How are credit scores calculated and what determines your score? Equifax, Experian and TransUnion declined to detail the alchemy that goes into VantageScore.

It's likely, however, to be similar to what goes into the FICO scores, which range from 350 to 850.The formula for creating those scores works like this: FICO first sorts each person into one of 10 credit categories so that, for instance, people with "thin files" — not a lot of credit history — are compared only against other people with thin files. The formula then starts with a neutral score — about 600 points — and begins adding and subtracting points based on the activity shown in the file, said Craig Watts, a Fair Isaac spokesman.

Scores are based only on what is in the consumer's credit file — and that file can be different from one credit bureau to the next. So it's not uncommon for the same person to find that his or her FICO score at TransUnion is different from that at Experian or Equifax.

There are also some variations in the formula, based on which of the 10 categories a person falls into and which bureau is providing the report.Nonetheless, five factors account for the vast majority of any FICO credit score.

• Thirty-five percent of your credit score is based on how you have repaid your credit obligations. Points are added for people who always pay their bills on time; points are subtracted for those with some late payments, non-payments, "restructured" payments — when the creditor agrees to take less than what's owed — and bankruptcies.

The more credit that you have used, and paid consistently, the better your score. Naturally, the most serious credit faux pas take away the most points — a bankruptcy is going to harm your score much more than a few 30-day late payments.

• Thirty percent of a score is based on your debt-to-available-credit ratio. The lower that ratio, the higher your score.For instance, if you have a $100,000 home equity line and four credit cards, each with $5,000 limits, your total available credit is $120,000. If you've borrowed a total of $5,000 on the credit cards and $10,000 on the home equity line, your debt amounts to $15,000, or 13% of your available credit.If, however, you have just $20,000 in available credit and have borrowed $15,000, you have a 75% debt-to-available-credit ratio. That makes you look overextended and will result in a much lower credit score.

Moral of this story: Consolidating your debt onto one or two cards and canceling the unused cards could hurt your score by reducing the amount of credit you have available and, thus, boosting your ratio. Unless there's a compelling reason to cancel — such as having to pay annual fees to hold those unused cards — don't.

• Fifteen percent of your score is based on the amount of time you've managed credit. If your credit file lists experiences, from student loans to credit cards, that go back decades, you'll score better than somebody whose oldest credit experience was what was reported last month.• Ten percent of your score is based on how many different types of credit you have handled in the past. Someone who successfully paid a mortgage, a home equity loan, a car loan and credit cards will score higher than someone who has one type of loan.

The good news: Repaid debts usually remain on your file for many years, Watts said. So you don't get penalized for responsible behavior such as paying off your car loan, he said.

• The final 10% of your score is based on new credit applications and consumer-initiated credit "queries." Each time you apply for credit, a credit query hits your file. If you have a lot of those inquiries in a short period of time, this portion of your score suffers, Watts said. That's because people who apply for vast amounts of credit in a short stretch are eight times as likely to file for bankruptcy, he said.

Trio of Agencies Create New Credit Scoring

2006-03-19T20:56:00.000-07:00

New York (March 15, 2006) - Three consumer credit reporting agencies announced that they have created a new credit scoring system to simplify the loan process for lenders and borrowers.
Advertisement

The Equifax, Experian and TransUnion agencies said their new VantageScore system has grown out of the market's demand for a more objective approach to scoring. Agencies have each used their own formulas to create scores in the past.

In a statement, the agencies said VantageScore "will provide consumers and businesses with a highly predictive, consistent score that is easy to understand and apply."

The new scores, will range from 501 to 990, are already available to financial institutions and will be rolled out for consumers later in the year. Experian said the new scores will be grouped on the familiar academic scale, with an "A" being given to scores in the 901 to 990 range and an "F" being given to scores in the 501 to 600 range.

VantageScore is being independently marketed and sold separately through each of the three national credit reporting companies via licensing agreements with VantageScore Solutions LLC, which is jointly owned by the three credit bureaus. An informational Web site can be accessed at www.vantagescore.com.

— WebCPA staff

Giving Credit Where Credit Is Due

2006-03-19T20:49:00.000-07:00

Giving Credit Where Credit Is Due

Three credit bureaus band together to rival Fair Isaac's FICO scoring system. If VantageScore is more accurate, will lenders change their ways?

It's the multibillion-dollar question that every credit-card company, auto lender, and mortgage outfit wants to know: If they lend you money, will you pay it back? Fair Isaac -- creator of the famous FICO score -- is the company that answers that question most often today. But on Mar. 14, the Big Three credit-reporting companies unveiled what had been a tightly guarded secret plan to knock Fair Isaac from its throne and become the dominant provider of credit scores to lenders. For most borrowers, this is a good thing. More intense competition will force everyone in the credit-scoring business to assess default risk as accurately as possible (see BW, 11/28/05, "Anatomy of a Credit Score"). Creditworthy people who were unfairly lumped in with deadbeats are more likely to get credit now, and at lower rates. Of course, poor risks who were accidentally given loans are more likely to be rejected if accuracy improves. On the whole, though, lenders will tend to make more loans, at lower rates, if they have increased confidence in the accuracy of credit scores. SETTING STANDARDS.

VantageScore was announced jointly by the top credit-reporting giants: Equifax (EFX ), Experian, and TransUnion. Scores will range from a sterling 990 down to a bankrupt 501. In contrast, FICO scores range from 850 to 300. As a gimmick, VantageScore may also be reported as a letter grade -- from A through D, and F. To create VantageScore and better compete with Fair Isaac (FIC ), the three rival credit bureaus set aside their differences and started from scratch, using raw data on millions of people in their databases.

They devised a standard way to categorize borrowers, as well as a standard recipe to determine creditworthiness. The bureaus won't share data. Instead, each will use the recipe on its own data to produce a credit score. The only source of difference between bureaus' VantageScore results will be the raw data -- such as missing or inaccurate information -- not scoring methodology. Until now, the three bureaus offered their homegrown credit scores for sale to lenders but didn't get as many takers as they'd hoped, because many lenders preferred FICO scores.

Experian and Trans Union also sold their scores directly to consumers. It has been highly frustrating to lenders -- and to borrowers -- that the same person could get drastically different credit scores from different bureaus. SUBPRIME MARKETING. On the bright side, the companies say that using VantageScore reduces by about 30% the wide "dispersion" in scores that the different bureaus generate. On the not-so-bright side, that means that 70% of the dispersion remains.

That's because VantageScore can't overcome the problem of incomplete or inaccurate information. "Garbage in, garbage out," says Greg Fisher of Dayton, Ohio, who runs two Web sites on the subject, creditscoring.com and creditaccuracy.com.

While acknowledging that VantageScore isn't perfect, its authors say their tests show it makes better predictions about loan applicants who have "thin files," such as young people with no credit history. It should also help lenders better segment less creditworthy "subprime" borrowers, so they can figure out which ones to market to and which to stay away from, says Dana Wiklund, senior vice-president for predictive sciences at Equifax (see BW Online, 9/14/05, "Subprime Lenders Bear Scrutiny").

While it may not matter much to consumers, a big issue for the industry is how VantageScore will fare against Fair Isaac.

The Big Three say they haven't yet measured its performance vs. FICO. Fair Isaac, with revenues of nearly $800 million last year, says it counts 99 of the top 100 U.S. banks as clients. However, investors see a challenge. Fair Isaac shares fell nearly 7% on the news of the competing system. ANTITRUST CONCERNS?

Fair Isaac Chief Executive Tom Grudnowski said in an interview that FICO scores are deeply embedded in the way lenders evaluate loan applications. The biggest challenge for the credit bureaus, he says, will be to prove that their score is so much better that it justifies ripping up the way they do things now. Says Grudnowski: "There's got to be a really compelling reason to convince an institution to change."

There's also the question of whether the close collaboration between three industry rivals could be perceived by antitrust regulators as an attempt to squelch competition and raise prices. A Justice Dept. spokeswoman on Tuesday said the department would have no immediate comment. A Federal Trade Commission spokesman did not immediately return a phone call. Only time will tell how they rate VantageScore.

Credit Bureaus Join To Remake Scoring

2006-03-19T20:47:00.000-07:00

Credit Bureaus Join To Remake ScoringSystem Employs Letters, New Scale

By Caroline E. MayerWashington Post Staff WriterWednesday, March 15, 2006; D01
The nation's three largest credit bureaus yesterday unveiled a new credit scoring system that they say will make it easier for lenders to determine a borrower's credit risk and for consumers to more accurately gauge their financial health.

In a rare cooperative venture, Equifax Inc., Experian Information Solutions Inc. and TransUnion LLC designed the new system, called VantageScore, to simplify the credit-application process by providing an easy-to-understand, consistent score among the three firms. They say the score will better predict whether a consumer will make timely payments over the life of a loan.

However, the three credit bureaus released so few details about VantageScore that industry officials and consumer activists said that the credit-application process could become more confusing for consumers, certainly in the short-term and possibly longer.

VantageScore will compete with FICO, the scoring system created by Fair Isaac Corp. and used in about 75 percent of all mortgage applications. It will use a different set of calculations to produce scores, ranging from 501 to 990; the FICO scale goes from 300 to 850.

Although the credit bureaus are starting to sell VantageScore to lenders, the new scores won't be available to consumers for at least several weeks. Consumers can continue getting the individual credit-bureau scores as well as FICO scores. The latter vary widely among the credit bureaus, a common complaint that led to the creation of VantageScore.

The new scoring system will not be valuable to consumers "unless the credit grantor adopts and uses it," said Paul J. Springman, chief marketing officer for Equifax. He said his firm would switch as soon as lenders accept the new system. "That will take more than six months," he said.

Experian said it hoped to offer the new score to consumers within eight weeks, while TransUnion said it would do so later this year.

Virtually no loan is granted today without a credit score -- a three-digit number based on payment history, outstanding debt, and the number and type of accounts. Lenders say these scores treat applicants more objectively and speed up the approval process, which is critical in today's credit-based economy.

The higher the score, the better the credit risk -- and the lower the interest rate to be charged. For FICO, most people score in the 600s and 700s, and anything above 700 is considered very good financial health. Under VantageScore, anything above 900 is considered an A; from 800 to 900 is a B and so on.

The different scoring scale might confuse consumers, who are still getting used to the FICO system, said Stephen Brobeck, executive director of the Consumer Federation of America. "This is complicated enough without a second scale," he said.

The credit bureaus said they developed VantageScore after lenders requested a more accurate system, one in which scores did not vary widely among credit bureaus. The score will be independently marketed and sold by each bureau through licensing agreements with VantageScore Solutions LLC, which is jointly owned by the three companies.

Although the new mathematical formula used to come up with the score is intended to reduce the variation, there will still be differences because each company collects data differently. Since some accounts may be listed at one bureau but not the other, a consumer may still get different scores from each firm.

"It doesn't address the larger issue of how accurate are the files," said Gail Hillebrand, a senior attorney with Consumers Union.

VantageScore represents an attempt by the credit bureaus "to develop a better mousetrap, to put more money in their pocket and prevent more from going out of it," to rival FICO, said Greg McBride, senior financial analyst for Bankrate Inc., whose Web site Bankrate.com aggregates financial rate information.

Ron Totaro, vice president of Fair Isaac's Global Scoring Solutions said the 17-year-old FICO score is "pretty ingrained and encoded in computer systems" of lenders, which will make it hard for financial institutions to switch. "It's very difficult to come up with a better mousetrap," he added.

Douglas G. Duncan, chief economist for the Mortgage Bankers Association, said VantageScore's success will depend on accuracy, price and product efficiency.

McBride said that with the dueling systems, banks will become much "like high school seniors deciding which college-entrance exam to take, the ACT or SAT."

© 2006 The Washington Post Company

Agencies Adopt New Credit Scoring System

2006-03-19T20:29:00.000-07:00

Agencies Adopt New Credit Scoring System

By EILEEN ALT POWELL AP Business Writer

(AP) - NEW YORK-The nation's three major consumer credit bureaus have created a new credit scoring system designed to make it easier for financial institutions to evaluate loan applications and to give consumers a better way of measuring their financial health.
The credit reporting agencies - Equifax, Experian and TransUnion - announced Tuesday that they're introducing "VantageScore" to banks, mortgage lenders and credit card companies immediately. The new scores will be available to consumers after the lender rollout, probably later this year.

"There's clearly been a need out there to have a consistent scoring model that works across all three reporting agencies' data," said Kerry Williams, group president of Experian's credit services division. "And consumers need a consistent score that they can understand and use in their own financial lives."

Credit scores traditionally have been three-digit numbers that lenders used to evaluate the creditworthiness of borrowers. The scores reflect how much debt a consumer is carrying, how good they've been at paying back loans and how many credit applications they have outstanding.

They're important because lenders use them to determine if they'll loan money to consumers and at what rate. The higher the score, the more creditworthy the consumer is considered and the lower the interest rate the consumer will be charged.

The agencies in the past each used their own proprietary formulas to generate their own scores, meaning that a lender dealing with a consumer's application for a credit card or a mortgage might have to reconcile three widely different scores.

With the new system, a single methodology will be used to create the scores for all three credit bureaus, the agencies said.

As a result, scores will be "virtually the same across all three of the national credit reporting companies," said Experian spokesman Donald Girard. Any difference in the scores provided by each agency will reflect differences in the data they've collected in consumers' files, he said.
The credit reporting agencies said in their announcement that VantageScore "will provide consumers and businesses with a highly predictive, consistent score that is easy to understand and apply."

Consumer advocacy groups expressed concern that the new scoring system would not eliminate one of the biggest problems in the industry which is incorrect information in consumers' credit files.

"That means it's a new recipe, but the same old ingredients," said Jean Ann Fox, director of consumer protection with the nonprofit Consumer Federation of America in Washington, D.C. "It doesn't address the underlying accuracy of the credit reports on which the scores are based."
In addition to the credit agency scores, some large lenders generate their own internal scores, often using credit bureau data. And many lenders, especially those in the mortgage business, use FICO scores, which are named for the Minneapolis-based Fair, Isaac Corp. that developed them.

Thomas G. Grudnowski, the chief executive officer of Fair, Isaac, said that "for the past 20 years, we've been both cooperating and competing with the credit bureaus ... and that will continue." He added that it could take a long time to establish a competing system.
"Do the customers ... really want to go through the pain of converting to another system?" he asked. "I think only time will tell."

Dana Wiklund, senior vice president for predictive sciences at Equifax, said that VantageScore "is a new, competitive product to give lenders greater choice, and hopefully greater accuracy, in credit scoring." He added: "The rate of adoption will determine ultimately if the (new) score replaces any in-house or generic scores in the market."

Executives at the credit agencies said that the bureaus did not need to consult with federal regulators before developing their new scoring process. But a number of executives, including Wiklund, traveled to Washington, D.C., on Monday to brief bank, savings bank and credit union regulators on the new scoring process.

"The role of the regulators is to look at the safety and soundness of the institutions they oversee," Wiklund said. "They're very keenly interested so that models don't have disparate impact ... on low income vs. high income individuals, minority vs. non-minority, that kind of thing."

VantageScore ratings will range from 501 to 990. The top end is slightly higher than scores currently in use.

In a separate statement, Experian said the new scores will be grouped on "the familiar academic scale." Experian gave these groupings, with A and B being the best potential borrowers and D and F being the weakest:

A - 901-990
B - 801-900
C - 701-800
D - 601-700
F - 501-600

Colleen Tunney, spokeswoman for TransUnion, told a conference call with reporters and credit industry representatives that the new score was created by looking at millions of consumer files at the same time to ensure consistent readings across the three bureaus' data.

David Rubinger, spokesman for Equifax, said the new score was expected to reduce the variance in a consumer's scores by about 30 percent compared with what it was under the old system.
He said the score would reflect a consumer's frequency of borrowing, delinquency in paying bills and other "file content." But Rubinger and other credit bureau spokesmen said it was too soon to provide the specific weights for the components.

VantageScore is being independently marketed and sold separately through each of the three national credit reporting companies through licensing agreements with VantageScore Solutions LLC, the joint announcement said. The spokesmen said that VantageScore was jointly owned by the three credit bureaus. They said it did not yet have a headquarters, although an informational Web site had been set up at http://www.vantagescore.com.

The credit reporting agencies are operated by Equifax Inc. of Atlanta, Experian Information Solutions Inc. of Costa Mesa, Calif., and TransUnion LLC of Chicago.