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Thread: new credit scoring system going into effect very soon

  1. #1
    Banned Melonie's Avatar
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    Default new credit scoring system going into effect very soon

    My take on this shift to a new VantageScore system is ...

    - it creates standardized formula for calculating credit rating which all of the credit rating agencies will share (which probably will work against self-employed persons because the formulas don't allow for inclusion of individual factors)

    - it is based on a 24 month payment history (which can be good or bad compared to the current system, depending on the fine print)

    - is intended to reduce 'manual review' of new loan applicants' credit histories by bank / financial institution personnel with personal factors taken into consideration, versus automatic X credit score needed for approval or automatic X disapproved, Y approved at high interest rate, Z approved at low interest rate (which probably will also work against self-employed persons)

    - the timing is probably directly related to expectations in the banking industry that the credit ratings of many Americans are likely to undergo major changes very soon.

  2. #2
    AudreyLeigh
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    Default Re: new credit scoring system going into effect very soon

    I like the possibility of only having to deal with ONE credit reporting company. BUT with this and no manual looking over credit report theres going to be a LOT of denials that may have been approved with the current system. Dunno what I think, really. Not sure if it would take off either. Kinda hoping no.

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    God/dess greenidlady1's Avatar
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    Default Re: new credit scoring system going into effect very soon

    Yeah, I hope it helps my situation and my husbands. He just got a secured credit card to build his credit which has been non existant. I just paid off everything with the exception of a few medical bills which I don't think count against me as much as the credit cards being unpaid did. I think if I do what Venus said, dispute everything, that will temporarily bring my score up so I can finally purchase a car.

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    Banned Melonie's Avatar
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    Default Re: new credit scoring system going into effect very soon

    well, unfortunately there's no guarantee that future disputes under VantageScore will be handled in the same way as they are under the current system ... with the applicant being given the benefit of the doubt unless proven otherwise within a certain time limit.

    That's what worries me the most about VantageScore, that the new fine print may actually be closing the door on past strategies which could be successfully used to 'game' the system.

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    Default Re: new credit scoring system going into effect very soon

    Quote Originally Posted by greenidlady1
    . I just paid off everything with the exception of a few medical bills which I don't think count against me as much as the credit cards being unpaid did. .
    But, under this new system, would they be able to ascertain that they are medical bills rather than credit card bills?

    I don't know...this doesn't sound like it's going to be too good for people who had really good reasons for their credit woes.

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    Default Re: new credit scoring system going into effect very soon

    Quote Originally Posted by Melonie
    http://www.vantagescore.com/businessinfo.html

    My take on this shift to a new VantageScore system is ...

    - it creates standardized formula for calculating credit rating which all of the credit rating agencies will share (which probably will work against self-employed persons because the formulas don't allow for inclusion of individual factors)

    - it is based on a 24 month payment history (which can be good or bad compared to the current system, depending on the fine print)

    - is intended to reduce 'manual review' of new loan applicants' credit histories by bank / financial institution personnel with personal factors taken into consideration, versus automatic X credit score needed for approval or automatic X disapproved, Y approved at high interest rate, Z approved at low interest rate (which probably will also work against self-employed persons)

    - the timing is probably directly related to expectations in the banking industry that the credit ratings of many Americans are likely to undergo major changes very soon.
    We already used a system very similar to the Vantagescore before, this won't change much. That and each bureau will still have different scores.

    Under the new scoring system, credit score
    variance between credit reporting companies will be attributed to data differences within
    each of the three consumer credit files and not to the structure of the scoring model or
    data interpretation.
    So it'll be the same as it is now assuming the individual bank even wants to use the scoring system. It's just a different way to calculate a risk score and one was already in place on all the bureaus anyways. We already use the current risk score + FICO, so it's the same 'ol same 'ol.

    It won't affect disputing trades.

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    Default Re: new credit scoring system going into effect very soon

    Quote Originally Posted by DylanAngel
    But, under this new system, would they be able to ascertain that they are medical bills rather than credit card bills?

    I don't know...this doesn't sound like it's going to be too good for people who had really good reasons for their credit woes.
    The system won't affect how medical bills show up.

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    Default Re: new credit scoring system going into effect very soon

    Well that's good to hear! Thanks for the info. There's a ton of people that a situation like that would affect.

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    God/dess Gynger's Avatar
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    Default Re: new credit scoring system going into effect very soon

    Well I have a very odd situation, and Melonie maybe you can help me. I have two scores with all three bureaus. Yep I do. I just purchased a car and found out I have two scores. My old score when I was married to my ex husband and my new score. My old score- 630, my new score 720- how is this even possible? I have worked diligently for two years to remove debt that is not mine and I have been able to get some credit, my new husband added me to some of his debt (mortgage, two credit cards) I had my student loan and a credit card I paid off religiously every month. I was surprised when my husband said to try to apply for a loan on my own, when I did I got a fair interest rate (7%) for a two year old car. The finance manager said, you have two scores.. and the banks work off the most recent.

    So my question is, do I even bother trying to fight all three bureaus to remove the old shit that isn't mine anymore since I have rebuilt?

    As for the one credit reporting system, I'm all for it. All three currently seem to have all different rules, and different standards, and it gets confusing.


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    Featured Member Vamp's Avatar
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    Default Re: new credit scoring system going into effect very soon

    They have tried to change the credit scoring system many times. Companies hate change. Especially at this scale. I doubt it will catch on. Companies love the system we have now. They know what is based on and how it works. Each agency's reports are used for differant purposes. It is better to have a view from three sides than just one.


    btw as far as two credit scores. Did they say where the two scores came from? It may be two scores in the banks computer system if you applied for a loan at another time with them. Pull your credit reports from all the agencies and see what is on them yourself. Then create a game plan to improve them.

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    Default Re: new credit scoring system going into effect very soon

    Gynger I knew someone that I think had a similar problem. She couldn't even get a cellphone in her married name but when she applied under her maiden name they approved her. I dont' know what she ever did about it though. I think she just stuck to using her maiden name after that!

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