Fair Isaac Co. will no longer sell Experian-based credit scores

Apparently, the New York Times is on a roll with following the unpredictable and frightening moves in the credit industry. The latest involves Fair Isaac Co.’s announcement that it will no long sell Experian-based credit scores beginning on Feb. 14.  How fitting that the love-fest will end on Valentine's Day!

Fair Isaac Co. (FICO for short) created the FICO credit score, a method of determining the likelihood that credit users will pay their bills. Consumers have three FICO scores based on information collected by the three largest credit bureaus including TransUnion and Equifax.  Equifax’s FICO score is the most common score used, but some companies like American Express use Experian.  The scores can differ by as much as one hundred points in some cases depending on the formula used.  

Experian cannot distribute its FICO scores to consumers directly or through other outlets.  As Tom Quinn, vice president for scoring at Fair Isaac Co., put it, “their decision means that consumers will no longer be able to see or manage their scores based on the Experian data.”  However, the article goes on to mention that “Experian itself will continue to sell FICO scores based on its data to lenders, so some banks may make credit decisions, at least in part, on a score that consumers can no longer see.”  Moreover, Experian will likely push their own propriety three-digit credit score that does not use the FICO formula as a base.  

In conclusion, this is a major setback for consumers who will be assessed based on information to which they will no longer have access.  If anything, the game becomes more complicated with more formulas and proprietary ways to evaluate consumers.    

[ Read the New York Times article. ]

Comments

[The Credit Beast]

I just watched that 20/20 feature and it is all appalling at the least. This crisis is exposing all kinds of things going on behind closed doors. In due time, all things done in darkness will come to light.

[Carole]

Well, after watching 20/20, I can now understand why JP Morgan Chase raised my interest rate. I have to help them pay for their high priced prostitutes that they were charging to corporate credit cards. When is the government going to stop giving these banks money???

[nyc]

This is a wonderful site! The banks and credit card companies (and the credit rating companies) are bloodsuckers. (I'm sure there's a more technical term for it, but no sense in mincing words.) I think we should organize as consumers and keep the pressure on. A major bank hiked my interest rate and then offered to lower it to the original rate after all the scandals broke recently. Bad press scares them, and they need that bailout money.

Let's make them pay for it.

[Terry]

You can report their failure to provide adequate and timely notice to:

Office of Thrift Supervision
Consumer Program Division
1700 G Street, NW
Washington, DC 20552

1-800-842-6929

www.ots.treas.gov

[The Credit Beast]

Yes, Carole. I think that medical bills are the number reason for bankruptcy. Isn't that terrible. I cannot imagine being sick and having to worry about the stress of paying bills etc. I need to focus on getting better. Maybe I should move to Canada.

[Eileen]

I agree we should flood our government reps with emails about this. The credit card crisis, as it affects us - the consumer - , will be so much bigger than the home foreclosure issue. I have written my State Senators and Reps and have gotten similar "canned" responses to the credit issue and all they reference is the bill that will be enacted in 2010. So my feeling is the Senator and/or Congressperson is not reading the emails ... there's some staff person on the other end just glancing at the message and saying, "oh, ok, it's about credit cards ... reply with "this" stock message". Perhaps we should call them directly instead.
Also, would like to bring your attention to a document that is a link from the American Express website ... the document is called "Credit Cards - What you need to know - A Training Manual" .... in it it says that card companies "LEGALLY" must notify you 15 days in advance of any changes. When I found out my AMEX card had been cancelled (by trying to make a purchase on Jan 29, 2009), I called AMEX and was told a notice of cancellation had been sent to me on Jan 23, 2009. Hmmm, let's see .... looks like five or six days to me. Sounds like perhaps they are in violation of notification requirements but WHO do we report this to? I have asked countless people "who regulates a company like American Express "and no one seems to know. The government doesn't because they are not a "National Bank". Should I call the local sheriff?

[Carole]

You might want to start caring about your FICO score since it is being used to see if you qualify for an apartment, it's being used by employers to see if you get the job, and a host of other things. It's no longer just about getting a credit card. It also affects how much you pay for your car insurance.

Oh, and if you only buy what you can pay for . . . don't ever get sick. I caught a virus from a coworker, it attacked my heart and in one month I had over $15,000 worth of medical bills, and only part of them was covered by my health insurance. Don't think that everyone who has credit card debt has it because they have a new stereo and a big screen TV. I have none of those. I had to use credit cards to pay for medical tests, doctors, and the hospital.

[Pam R]

Stay out of debt and the score does not matter- I do not buy it unless I can pay for it-I do not spend it unless I have it.I at this point could care less what my all mighty FICO is.I thought the goverment mandated that comnsumers could see all of their scores at least once a year?Only reason i would want to see it -to make sure some Yahoo is not using my info for his gain.

[Carole May]

I agree. I have been emailing my senators and representative about all of this. Yesterday I wrote to the President. It's the first time in my life that I ever sat down and wrote to the President.

I think what we need to do is that all of us have to start writing letters to our senators and representatives. We need to flood their offices with so much mail they'll need a snow shovel to get out from under it. That's the only way they are going to listen.

I have had all my credit card interest rates raised recently. These banks are going wild with this. Yes, there is a bill to stop this in 2010 but that's too late. We need help NOW! I pay twice the minimums on my cards every month and have never been late or gone near my limit. Right now I'm working on paying them off as I have already cut them up. From now on, it's cash only for me.

[Terry S.]

We need to vocalize our concerns by writing Congress. The lobbyists are successful only because they are organized. Our voices can be just as loud if we are willing to organize behind one organization to represent our interests. I nominate Kevin to head that organization!!!

[Sharon Barlow]

I have written to our state senator and representative and aksed them to check out this website. I think the information here is well written and clear. Perhaps if enough of our policy makers get the point that something needs to be done, change will come.

[eric]

While trying to increase my credit limit and talking with Bank of America World Credit Visa, they looked at my credit report and saw something that they did not like and thereupon closed my account, even though they knew that I had been a good customer for four years always paying more than my minimum payments and often paying down my bill to 0$ within 2 months. I think that BOA should be forced to pay back the money that we bailed them out on... they are, after all, the bank that created the Visa-Card system.

[Rachel]

How about we go back to good ol cash transactions. If that isn't safe use debit or check. That way who cares about the credit card companies. If you don't have the money don't buy it. If it is an emergency have a back up fund. If we don't use credit cards then we won't have the problems that come with them. Yes they are convenient but what did we do before them?

[Linda]

We, the American public, must raise our voices against all of this nonsense. The games and power plays of creditors and the credit bureaus is criminal. Not that I am for more government, but the President and Congress need to put a cease and desist on businesses that prey on the working person. You can't have too much credit, you can't have too little credit, you can't close accounts, you must continually run after due dates that keep changing so they can make a buck on late fees. Sears even has a cut off time...if your payment is due on the 19th, it must be paid by 3pm or you are late. This is all so terribly wrong.

[Sharon Barlow]

Good grief what's next?

[RiceCzeks]

This is just disgusting...
Really, how can they justify judging our financial worthiness on a score that we're a) not allowed to see, and b) not allowed to defend.
It's crap.

[Jason Allen]

This is ridiculous... I cannot believe that this is happening. Now what is going to keep the other companies from doing the same thing and then pushing their own scores for whatever price. This is not a good sign for anybody!!

[Eileen]

Yes, this is another fork stuck into us "cooked" consumers....
American Express said they used the info in my Experian Credit report for their decision to cancel my credit card. I immediately got my free copy of the report (which was stellar, by the way ... in TWENTY years I had one late pay in 2002 and one (disputed) late pay in 2003.) The free report does not give your credit score.

After I read this article I went to www.myfico.com to order my Experian credit score ($15.95)
and it was "very good". Now they will no longer provide access to your credit score through Experian yet many lenders will base their decisions upon that information!! It's almost like an "accused" not being able to question its "accuser" in a court of law. I'm particularly concerned because I think alot of the major banks, mortgage companies and credit card companies use Experian over TransUnion or Equifax. Does anyone know if that is true ???

And as my mind races, I remember a few weeks ago getting an urgent email from "My Check Free" (which is the online bill payment program I use to pay (guess who) American Express .... was hacked into on a certain day and my information may have been accessed... these instances are all unrelated but American Express figures into each one of them.