Credit Score News

Credit Score News

According to the latest analysis from Fair Isaac Corporation, the creator of the FICO score, average credit scores are rising and delinquent payments have dropped. The national average FICO score is now 695, which is the highest its been in at least a decade. In addition, almost 20% of consumers now have scores above 800. 

Why is this? 

The three major credit bureaus (Experian, Equifax, and TransUnion) have agreed to new guidelines for handling disputes on credit reports. According to this settlement, announced Monday by the New York Attorney General, credit disputes will now be handled by trained reviewers to determine what actually happened. 
FICO, formerly known as Fair Isaac Corp, has just released a new model for credit scores. On Thursday, the company announced that the latest version will no longer weigh medical debts as a part of the score. It will also discount overdue medical payments yet to be made. 

According to a recent report from the Wall Street Journal, some lending companies are starting to use social media when determining a borrower’s eligibility for a loan. Lenders will look at potential borrowers’ Facebook, Twitter, LinkedIn, and other social media profiles to gauge their financial risk and insure that their information is valid. For example, you might claim to be employed but post a Facebook status about quitting or getting fired from your job. Lenders will be able to see this and may not want to loan you the money.

The first app is a cloud-based management system that notifies customers through email, text or social media when a bill is ready for review. It also allows them to communicate with customer service easier on the go.

The second app - according to financial news site Inman News - is meant to replace the hassle of fax, scan or snail mail with an easy electronic signing tool. Essentially, the new app from FICO allows customers to view and sign (or refuse to sign) a document through their phone or computer. 

Student loan debt has exploded in the last several years, growing 54 percent to $26,549 this year, from the average $17,236 observed in 2005, according to a new report from the credit scoring firm FICO. Further, assuming there are about 200 million people with credit ratings nationwide, the number of borrowers who have student loan debts of $100,000 or more has more than tripled to 1 million in that time.

New data from the technology firm Ellie Mae shows that consumers who want to obtain home loans will now need both an extremely high credit rating and a significant down payment if they want to qualify, according to a report from the Los Angeles Times. In February, the average consumer who found they were approved for traditional home loans had a score of 764 and could make a down payment of 22 percent.