Consumers now have one key advantage they can take advantage of before taking out a mortgage. Thanks to Fair Isaac Corp., they can now view the same FICO scores (“credit scores” in simpler terms) mortgage lenders are able to view.
Fair Isaac is the company behind the FICO credit score and last week the company announced that it is offering consumers specific versions of the FICO score that had been hitherto unavailable to them, including the versions that mortgage lenders typically use when determining credit worthiness. Lenders use these FICO scores to find out whether a consumer is eligible for a loan, and what interest rate they would qualify for. However, these scores will come at a price – Fair Isaac’s new offering includes more than just multiple types of FICO scores beyond the one that is typically referred to in less formal terms as a “credit score.”
Usually, mortgage lenders use older FICO scores that are different from the ones that consumers find on their credit report, whether the score is purchased online or checked for free. There are also scores that are tailor-fit for the type of credit – these include scores gauging how well consumers have taken care of automobile loans or credit card payments. But with these multiple FICO scores now available to potential home buyers, that means they would be able to fine-tune their credit prior to applying, pursuant to having a better chance of qualifying for a low interest rate and/or down payment.
Further, consumers can also use these FICO scores when mortgage shopping. Several blog sites recently trumpeted the virtues of mortgage shopping, and with that in mind, knowing one’s FICO score could allow consumers to ask mortgage brokers what would be the lowest interest rates they can qualify for based on that score. It would also be possible to use mortgage comparison websites to check the lowest interest rates multiple lenders offer, again based on the score or credit score range.
Fair Isaac is offering different packages for consumers looking to buy FICO scores at the myFICO.com website. Monthly subscriptions are priced for as low as $14.95 per month, and while the basic data only includes scores from one credit reporting agency, or credit bureau, Fair Isaac says buyers can now get additional scores from other bureaus at the same price.
Quotes from former FICO employee and current CreditSesame.com president of consumer education John Ulzheimer suggest that there are about 200 million consumers with FICO scores, and over 50 FICO score versions for each individual.
As mentioned above, it is more than just FICO scores included in this new service. Fair Isaac will also educate consumers on the primary variables influencing each of their FICO scores. This goes back to the fine-tuning aspect also referred to earlier, as this better helps consumers in being cognizant on their areas of improvement that could help jack their credit scores up. Aside from mortgages, the additional scores can also help consumers who are looking to apply for a credit card or an auto loan, among other types of loans or debts.