Credit Scores

FICO Changes Could Lower Your Credit Score

https://www.wsj.com/articles/fico-changes-could-lower-your-credit-score-11579780800

Changes in how the most widely used credit score in the U.S. is calculated will likely make it harder for many Americans to get loans.

Fair Isaac Corp., FICO -1.39% creator of FICO scores, will soon start scoring consumers with rising debt levels and those who fall behind on loan payments more harshly. It will also flag certain consumers who sign up for personal loans, a category of unsecured debt that has surged in recent years.

The changes will create a bigger gap between consumers deemed to be good and bad credit risks, the company says. Consumers with already-high FICO scores of about 680 or higher who continue to manage loans well will likely get a higher score than under previous FICO versions. Those with already-low scores below 600 who continue to miss payments or accumulate other black marks will experience bigger score declines than under previous models.

Disclaimer:

Attorney Advertising. | This article is for informational purposes only and is not legal advice. | Reading this article or contacting us does not create an attorney-client relationship. An attorney-client relationship is formed only when an engagement letter is signed. | Prior results do not guarantee a similar outcome. | Adam G. Singer, Law Office of Adam G. Singer, PLLC, 400 Rella Blvd., Suite 207-488, Montebello, NY 10901, 212-203-0883