Why is the credit score from the bank lower than the score I get directly from the three credit reporting agencies and FICO.com?

Asked by Ralph

4 Answers

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Answered by David Skow, Mortgage BrokerPRO+ in Seattle , WA
Ralph - thanks for the question. The credit reports that consumers can obtain will vary from the lender-generated reports due to the different scoring models that the systems use. Often, this variance can be quite large. If you are working on obtaining a new loan, the best piece of advice is to connect with a lender and ask them to pull and provide a copy of a tri- merge (all 3 bureaus) report so you know these lender report scores.If you are only interested in checking your credit history , the systems you mention are likely fine to review the specific accounts, payment history etc., but not the scores :) Thanks. | 12.16.14 @ 00:07
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lucyhenry07 — Ok Thanks | 01.29.16 @ 03:29
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$commenter.renderDisplayableName() — {comment} | 12.11.16 @ 00:16
Answered by Ted Rood, Mortgage BrokerPRO+ in Maryland Heights, MO
David is correct, the scoring models for "consumer pulled" reports are vastly different than those on lenders' reports. They can be an indicator which way you're headed (if you were 740 last month and now you're 640, something changed!), but that's about all those "Credit Karma", etc scores are valuable for. | 02.02.15 @ 06:46
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$commenter.renderDisplayableName() — {comment} | 12.11.16 @ 00:16
S
Answered by smooninc
The Real Reason is that the banks manipulate your data in order to charge you as much interest as possible and make the most profit. When applying for a credit card, they want your score as high as possible so you qualify for more credit at a low rate which they can raise at a later date, when you have a higher balance. When applying for a mortgage, they want your score to be as low as possible so you don't qualify for a low fixed rate. Banks use a different formula to interpret your FICO score in order to achieve this, especially the larger banks, who would rather not tie up their money in risky long term private home loans anyway. | 02.04.16 @ 15:09
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cscasi60 — I am not sure I would rely on this answer. Most lenders would rather see a high score because it indicates that you, the borrower, would be less of a risk to the bank, If you ever run into this sort of thing, I suggest you go to another bank or lending institution for a second opinion. You might also want to check your credit history using The MoneyTips Credit Manager and ensure there isn't something being carried in it that is incorrect or does not belong to you; in which case you can get the institution to investigate it and take it off your history (if it is incorrect) and may increase your score. With rates as low as they have been, one does not normally want a variable loan as when rates rise so does your rate on your mortgage loan; depending on any guarantees on your loan not to raise it for "x" amount of time. But, as I am sure many know from past experience, they got variable rate loans and when rates went up, so did their payments and many could not afford them after a while and lost their homes. | 10.12.16 @ 15:56
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$commenter.renderDisplayableName() — {comment} | 12.11.16 @ 00:16
Answered by James Barath, CMPS, Certified Mortgage Planner in Crown Point, IN
Depending on the individual bank and whether or not that financial institution portfolio their loans, the bank in all likelihood is using an older legacy FICO scoring model. There are roughly 6 variations for each individual credit bureau (Equifax, TransUnion, Experian). | 05.31.16 @ 19:17
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$commenter.renderDisplayableName() — {comment} | 12.11.16 @ 00:16
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