Our FICO Labs team has taken a fresh look at national distribution of FICO® 8 Scores. With a couple of interesting exceptions, we found that consumer scores are continuing their slow return to a pre-recession pattern. The first two years of the recession (2008-2009) moved the scores for millions of... Continue reading

My colleagues in FICO Labs monitor FICO® Scores and how they move over time. In our most recent review, we continue to see the effects of consumers’ scores moving up AND down. At the high end of the score distribution, the number of consumers in the 800-850 range is at... Continue reading

More than ever, consumers are interested in their credit scores and credit reports. They ask questions when banking, paying bills online and shopping for a loan. This puts pressure on lenders to equip their employees with good answers to such questions. (myFICO.com is one source for those answers.) Unfortunately, this... Continue reading

Last month I posted that the national distribution of FICO® 8 Scores has had two major shifts during the recession. Some readers were puzzled that the observed shifts weren’t significantly larger, in light of the sour US economy. Actually, what appear to be small national shifts are quite dramatic changes,... Continue reading

This week, hundreds of credit counseling executives gathered in San Francisco for the annual leadership conference of the National Foundation for Credit Counseling. I participated on a panel to address what The New Credit Normal promises for consumers. As I explained, regulators are helping to empower consumers by having creditors... Continue reading

A comparison of nationwide FICO® Scores from 2005-2011 illustrates that score distribution has remained relatively stable at a national level. However a close look at the numbers suggests that U.S. lenders have experienced two distinct phases of consumer credit risk in the recession thus far. Early in the recession, lenders... Continue reading

In a recent joint “TweetChat” with Bankrate.com, we fielded hundreds of questions from participants on the specifics of a FICO® Score. Their questions ranged from basic to complex, reminding us that as consumers become more credit savvy, the complexities of the FICO Score can still be confusing even to a... Continue reading

Recently I blogged about common FICO® Score myths. Here’s another widespread misconception: People believe that their credit scores should improve when a credit card account is closed. Not true. In all likelihood, closing a revolving credit account either will not affect the FICO® Score at all, or it will cause... Continue reading

If your experience is anything like ours, you’ve found that some banking customers harbor strange ideas about credit scores. Here are several myths about FICO® Scores that we hear often. Myth: To get a high score, run up high balances on your credit cards. Contrary to what some believe, using... Continue reading

One of the reasons that the FICO® Scores are so powerful a risk predictor in the U.S. is that the underlying credit bureau data includes a wealth of both positive and negative bureau data. Now one large credit market that previously had only negative credit bureau data — Brazil —... Continue reading

A recent myFICO® survey of US consumers sheds light on consumer spending plans and concerns for the upcoming holiday season: Biggest financial worry going into 2011: Almost 40% said credit card debt. Holiday credit card spending: Almost half expect to charge an average of $100-$500 more than usual on their... Continue reading

Home Equity Lines Of Credit are an odd hybrid, offering the convenience of revolving credit and the security of a real estate-backed loan. Perhaps that’s why lenders are sometimes puzzled about the role of HELOCs in calculating FICO® Scores. For instance, we often get asked whether HELOCs factor into the... Continue reading

Credit scores hold true to the axiom that “Actions speak louder than words.” How each of us acts toward credit and creditors has proven to be highly predictive of our future repayment risk. FICO has found that some consumer actions are more predictive than others. One that we are often... Continue reading

The CARD Act has posed a number of challenges for issuers, not the least of which is how best to determine a consumer's “ability to pay”—a requirement that applies not only to new accounts, but also for credit line increases. The predominant response from issuers has been to implement an... Continue reading

When it comes to FICO® Scores for mortgage origination, several myths remain frustratingly hard to kill. Case in point: They resurfaced again in a recent column in the New York Times. It’s worth restating some of the plain facts about the use of FICO Scores in mortgage — facts that... Continue reading

One reason there are more consumers today with scores at the high and low ends of the 300-850® score range for FICO® Scores is that we have improved the FICO scoring models. The newest version — the FICO 8 Score — is a stronger predictor of future credit risk. Because... Continue reading