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Jacksonville Florida Real Estate Blog

Get latest news and real estate development in Jacksonville, Florida. A real estate blog by Will Vasana, Realtor.

March 04, 2006

Credit Score Variances

When it comes to your credit score, what most people don’t know is the scoring formulas, criteria and, most importantly, the range of scores is different for a mortgage than for other types of credit. Particularly credit scores generated on the Internet which are notoriously high to cleverly please the person who just paid $30 for it. There are over ten different scoring models from Experian alone that have varying applications in the world of lending. In other words the score a consumer gets on the Internet, at a car dealership, a mortgage company or a credit card are all different because they are not generated by the same software. While they all have similarities, they evaluate and weigh varying information differently, and most importantly have a different scoring scale. And if those discrepancies weren’t enough, consider that the term "credit score" is generically used by Experian and Trans Union because they do not use the FICO scores for their Direct-to-Consumer product. This has misled millions when purchasing their credit reports from these two bureaus. The "credit scores" from these two bureaus are based on completely different models than the FICO score and can differ as much as 100 points in some cases. For example a score of 720 on an Experian Direct-to-Consumer report is of very little use to mortgage lenders who must rely on the findings of the FICO score to qualify a borrower which will undoubtedly be lower. Keep in mind that the bureaus make millions off of their credit scores and do everything feasible to cloud this issue. If you need help with financing, please feel free to contact me. I can put you in touch with Watson Mortgage and can assist you in the process.

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