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Why are Your 3 FICO Scores Practically Always Different?


Janet had to increase her mid-FICO score three points to qualify for a mortgage. Her Equifax FICO score was 646, her Experian FICO score was 637, and her TransUnion FICO score was 631. She opened a new account that lowered her TransUnion FICO Score to 627, while also raising her Experian FICO Score to 643. (Her Equifax FICO Score stayed unchanged), She now qualified for a mortgage with her 643 mid-FICO Score.  


Why are your 3 FICO Scores different? This is a very good question. 


Go to any mortgage lender and you will see that the 3 Classic FICO scores are different. Ask any loan officer or credit counselor “Why” and you will truly stump them. Or they will respond that the information in your Equifax credit report, is different from the information in your Experian and TransUnion credit reports. That may be true to some extent, but there is another factor.


The FICO Classic Scores are used by all mortgage lenders and most auto lenders and credit card lenders. The Experian “Classic” FICO Score, the Equifax “Classic” FICO Score, and the TransUnion “Classic” FICO Score are based on the same “Classic” FICO score algorithm, but all three scoring algorithms have their own differences to give you three different FICO Scores. 

FICO says that their FICO scores are calculated on Payment History (35%), Amount Owed (30%), Length of Time (15%), New Accounts (10%), and Types of Accounts (10%). One can automatically assume from this FICO outline that all three FICO scores use the same algorithm. Breaking news here - they do not. 

The 3 FICO scores are different because they measure the information in your credit report differently. From my estimation and research, the three “classic” FICO scores measure about 60% of your credit report in the same manner. About 40% is measured differently. 


What are the Differences?


There are many differences. Here are a few. Experian and Equifax FICO scores value bank credit cards more than other store cards and credit union credit cards. TransUnion FICO Score does not differentiate between credit card companies. The TransUnion FICO Score looks at a mortgage differently than the Experian and Equifax FICO Scores. The TransUnion FICO Score also declines more than the other two FICO Scores when there is a late payment, collection, judgment or bankruptcy. The Experian FICO Score declines more when there is a high utilization ratio on a credit card – such as 80 or 90%. 

There are also differences between the three FICO scores in determining average revolving account age, consumer utilization ratio, recent account activity, and guidelines creating a FICO score after establishing new credit references. There are many more differences. 


What Does It Mean?


There are times when one can see one FICO Score go down while the other two FICO scores increase from on action. Many times, one FICO score goes up 10 points, a second FICO score goes up 15 points, and a third FICO score goes up 35 points. This happens all the time. The three FICO scores have different weights to one particular change in your credit report. It befuddles loan officers and credit counselors because they do not understand the differences and what is happening. Such individuals will too often provide their clients with some random off-the-cuff answer. Most of their answers are untrue.


Know What You Need to Do


Do you need to increase all 3 FICO Scores? Or do you need to just increase one or two of them? If you can know the particular sub-factors driving an individual FICO score, you can tailor your actions to improve that one FICO score and reach your goal. 

In upcoming logs, I will detail more of these differences so that you are aware of them. These differences are not known to the public. 

For your information, My Credit Plan is programed to identify these differences and tailors your solutions to meet your objectives. This can help you get better results on all 3 FICO scores. 

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