Max Score Credit Maximize Your Score. Maximize Your Life! Sat, 20 Oct 2018 17:16:46 +0000 en-US hourly 1 Why Credit Scores Aren’t the Same When Pulled From Different Places Thu, 27 Sep 2018 18:28:46 +0000 reportpic1

Why is my credit score not the same when it’s pulled from different places?

Many people are shocked and confused when they see their credit score from a particular source, and later notice that the score is completely different when pulled from somewhere else.  Imagine that you’re diligently working to increase your credit scores by tracking them through a credit monitoring service, paying your bills on time, and keeping your credit card balances low. Then, you go to a dealer to buy a car, only to realize that your score is 50 points lower.  Why is this?  Shouldn’t these credit scores be the same?  I mean, it’s being pulled from the same data and credit history, right?

Unfortunately the answer to that question is no.  It is unlikely for those scores to be the same.  In fact, you should not expect your scores to be the same when pulled from different places.  If you obtain a consumer credit report directly from the credit bureaus (Experian, Equifax, TransUnion), and then simultaneously got your credit pulled at  Wells Fargo Mortgage, Toyota Motor Credit, Capitol One Visa, and Bank of America, all of those scores will likely be different.  They would probably be within a range of 10-40 points.  However, if you had derogatory information on an account, like a late payment on a car loan, then the range could be even greater.

The first thing to understand is that the credit score is not actually for us, the consumers. It is actually for creditors and companies that offer credit. The credit scores give these companies a way to quickly assign risk when evaluating potential customers for new credit accounts. 

In recent years, an entire industry has developed allowing us to pull our own credit report through a credit monitoring service. This service allows us to see the items are on our credit report and track our credit scores. However, the purpose of the credit report and the credit score remains the same. It is a mechanism that companies use to evaluate us for new credit accounts.

FICO, which stands for Fair Isaac Company, is the internal system behind credit scoring. It is a complex mathematical algorithm that uses the information on our credit report to calculate the three digit number that makes up the credit score.  FICO has formulated different versions of their scoring model for different industries. The automobile industry will have a FICO scoring model that is different than that of the mortgage industry. The credit card industry has a different FICO scoring model then the one sold to the banking industry. Each industry has specific categories or account types that will receive greater focus, in an effort to determine a potential client’s credit risk for that industry  For instance, if a person has been late on previous car loans, their FICO score will be lower when their credit report is pulled by a company in the automobile industry. That is the reason why the credit scores reflect differently when pulled from different places.  Depending on the company and industry, the mathematical calculation of credit score will vary.

Let’s talk about the scores that you and I can obtain ourselves.  There are two types of scores that we as consumers can access. We can get a true FICO score by obtaining a credit report directly from the three credit bureaus. Another option is get a “simulated” FICO score by using ANY credit monitoring service besides the credit bureaus themselves.  In either case, the calculation of the credit score is a “vanilla” calculation WITHOUT any of the industry-specific score modifications.  Anytime a company pulls your credit, they are getting a TRUE FICO score. However, even if we get a TRUE FICO score by going to Equifax, Experian or TransUnion, it will still be different because it is reflected without the industry-specific score modification.

Does this mean that the scores obtained from a credit monitoring service are useless?  Absolutely not!  Mainly because this is the ONLY score that we can get without a company pulling our credit and causing us to obtain a hard inquiry. After all, a hard inquiry hurts the credit score. Using a credit monitoring service to track your credit scores and view your credit report is just as effective as using a report from the credit bureaus.

All of this probably sounds confusing, but just remember that the credit score is NOT a static number like your social security number. It is simply the end result of a mathematical calculation that can and will vary, depending on who is initiating it and in what industry they are in.

– Tim Craig, CEO Max Score Credit

History of FICO Tue, 04 Sep 2018 18:29:51 +0000 fico

Credit Bureaus Used to Have a Faulty, Unsystematic Way of Reporting

Before the development of the FICO Scoring Model by Bill Fair and Earl Isaac in 1956, there was no rating system or criteria in place to determine consumer credit worthiness. Department stores and finance companies established small, local credit bureaus to determine a consumer’s true risk factor. These unregulated credit bureaus allowed their employees to make final decisions about extending credit to consumers.

The local credit bureaus operated in silence and used concealed methods to gather information about consumers. They gathered information such as employment history, marital status, age, religion, and testimonials, just to name a few. Consumers, however, had no right to view their credit file. Unfortunately, there was no protection in place to protect consumers from credit errors. This faulty system left much room for discrimination in the credit reporting industry.

The Welcome Wagon Isn’t So Welcoming

Have you ever heard of or had experiences with a Welcome Wagon? Before the internet era, the Welcome Wagon was partnered with the credit bureaus! Part of their practice was to hand-deliver baked goods to their new neighbors in an informal “Welcome to the Neighborhood” visit. During their visit, they would gather as much information about the “new” neighbor as possible. By inspecting the home, the Welcome Wagon could determine the person’s financial situation by noting things like the quality of furniture and fine China. They would even pay attention to of the number of children living in the home. This was how local businesses and lenders gathered information about the new people in town.

The Credit Bureaus First Run-In with Regulation

In 1906, the Associated Credit Bureaus were established. The Associated Credit Bureaus, or ACB, was put in place to facilitate the goals of local credit bureaus and develop a cooperative interaction between them. This was the credit reporting industry’s first step towards reporting consistency. However, because this was developed prior to the web, much of the consumer information was collected and transmitted in print. The unreliability of this credit review system caused credit card companies and lenders to lose revenue because they were extending credit to un-creditworthy consumers.

Although the ACB laid the foundation for the three major credit bureaus that we all know today, there were still too many loopholes in the system. The Federal Government was receiving many complaints about discrimination in the housing loan industry. Credit bureaus were beginning to lose credibility and needed to do something major in order to stay in business. Due to immense pressure from Congress, lenders agreed to rid of their old system of gathering information. This decision was made not because lenders realized that they were doing a disservice to the community, but because this was the only way that they could stay in business.

To help govern the consistency and reliability of credit bureaus, congress developed the Fair Credit Reporting Act (FCRA) of 1971. This law enforced all credit reporting agencies to rid of the old system of gathering and obtaining information about consumers. Over time, information on consumer credit reports would become more reliable. This new development revolutionized the credit reporting industry,

Hello, FICO!

The old system was completely done away with and replaced with the FICO Scoring System. Bill Fair and Earl Isaac determined that a systematic method of using data will help lenders and credit companies make better business decisions. The integration of the FICO system used mathematical algorithms to create the credit report and calculate the credit score. The FICO Scoring Model is broken down into 5 categories: Payment History, Revolving Debt Ratio, Average Age of File, Mix of Credit, and Inquiries. Max Score Credit’s A.C.T. system is designed to impact all 5 categories of the FICO scoring model.

With the development of FICO, underwriting for lenders become a much faster and more effective process. Lenders could make credit decisions based on the credit score, rather than having to read and/or understand the entire credit report. Underwriters no longer needed in-depth credit knowledge to analyze true risk factor. The downside to this is that consumers were being judged as three-digit numbers, not individuals.

Presently, there have been many developments in the FICO Scoring System. Fico has formulated many different versions of their scoring model so that different companies can use industry-specific data to asses a consumer’s true risk factor.

Credit reporting has come a long way. It was once secretive, discriminatory, and unregulated. Although there are still some inconsistencies in credit reporting, consumer credit data is now fully protected under the law. Inaccurate and unverifiable data must be removed from the credit report, according to the FCRA.

FICO has recently developed a new scoring system called Vantage Score 3.0. An advantage to Vantage Score is that it does not recognize paid collections, which negatively affects the credit score under the stipulations of the FICO scoring model. Also people who are not able to have their FICO scores generated, for various reasons, will not have any difficulty generating scores using Vantage Score. It may take years for companies to incorporate the Vantage Score System into their credit decision-making. However, it will be interesting to see how this system transforms the credit reporting industry.

– Jakira Williams

FICO and YOU Wed, 22 Jun 2016 18:27:38 +0000 The FICO Scoring Model is used by lenders to determine your credit worthiness. The FICO Model compiles data from your credit report in order to determine your actual credit scores. This data is sorted into five different categories.

FICO Break Down: 


1. Payment History – 35%

2. Revolving Debt Ratio – 30%

3. Average Age of File – 15%

4. Mix of Credit – 10%

5. Inquiries – 10%



Payment History is the largest component of the FICO Model. This category impacts 35% of your overall credit score. Any late payments, collections, charge-offs, judgments, bankruptcies, and/or tax-liens negatively impact this category. These derogatory items stay on the credit report for 7-10 years, and each type has a different effect on your credit score.

In order to positively affect the Payment History category, it is important to pay your bills on time!

The next largest component makes up for 30% of the FICO Scoring Model. Revolving Debt Ratio, (also known as credit card utilization percentage) is the relative value of the amount of revolving credit owed in relation to the amount of available credit. In other words, it’s the balance of your credit cards divided by the limit. If your Revolving Debt Ratio exceeds 30%, your credit score will be negatively impacted.

For example, if your credit limit is $10,000, keeping your balance at $3,000 will keep your utilization percentage at 30%.

Average Age of File is responsible for 15% of your credit score. This component of the FICO Scoring Model is measured by how long your open accounts have been established and how long it’s been since certain accounts have been used. For this category, FICO considers the age of your oldest account, newest account, and an average age of all accounts.

The longer the credit history, the higher the credit score. However, it is still possible to have a high FICO score without established credit. This will ultimately depend on what the rest of your credit report looks like.

Your Mix of Credit is weighed-in as 10% of your credit score. FICO calculates the different types of credit accounts that you have, and how many of each type.

There are many different types of credit accounts. These include credit cards, retail accounts, installment loans, mortgage loans, and finance company accounts. Having at least four different types will give you a good mix of credit. It is important, however, to only open new accounts as needed, Here’s why:

Inquiries also have an effect on your overall credit score. Inquiries, simply defined as requests for credit, make up 10% of the FICO Scoring Model. Having too many inquiries in a short period of time will have a negative impact on your credit score.

Inquiries stay on your credit report for two years. If you apply for the same type of credit within a two-week period, the credit bureaus will count this as one inquiry. Remember, only apply for new credit as needed. If you don’t need it, don’t apply for it!

Welcome! Mon, 04 Jan 2016 18:26:43 +0000 To all of our friends, clients, and those considering our service, welcome to our blog! We will be providing you with a wealth of information about our consumer and business credit building service, testimonials from current and past clients, and much more!

Be sure to visit our page often! We promise to not only keep you up to speed with what’s happening at Max Score Credit, but we’ll have some fun as well!

Max Score Credit Consumer Website Sat, 02 Jan 2016 18:26:20 +0000 Max Score Credit Consumer Website

This is a link to our primary website.  On this website is a wealth of information, explanation and videos, detailing our credit repair and restoration program.