SACRAMENTO (CBS13)— Craig Moegel knows he has excellent credit, but wasn't so sure he had a perfect 850 FICO Score as listed on his February and April Discover statements. The credit card company started offering FICO scores for free on their statements late last year.
Credit Expert and Author of "The Road to 850" Al Bingham says he's never seen a perfect FICO score. Bingham who is also a loan officer pulled Craig's Classic FICO score, and found it was 812. Moegel also purchased his credit score in early May through MyFICO.com and found it was 777.
"He has very good credit, but not an 850 credit score," Bingham said.
So how did Craig get that perfect 850 on his Discover statement?
"It is a FICO score, but there are multiple versions of the FICO score," said FICO Spokesperson Anthony Sprauve.
He says at any given moment, 2 million Americans have perfect FICO scores. Sprauve told CBS13 there are 49 different FICO scores developed for the various companies wanting them and the scores change constantly. FICO would not disclose to CBS13 the names of its 49 scoring models, although they sent us a link to a graphic published by Credit Sesame.
A credit card company may use a different score than a car lender or home loan company.
"They are all based on the same core algorithm, and so there will be variances, but they're not going to be significant variances," Sprauve said.
He says the differences are less than 50 points in most cases. Bingham points out 50 points in a credit score can amount to higher interest rates, adding up to tens of thousands of dollars over the life of a loan. He thinks the Discover FICO score is deceptive and he wants to know how their score is being generated.
FICO and Discover would not specifically discuss how the score is calculated or if Craig's score was a mistake, although Discover does outline what goes into a FICO score on its website.
Discover told us in a statement, "though there are many types of credit scores, FICO Credit Scores are the most common credit scores used by lenders. Like most other lenders, Discover uses the FICO Credit Score as one piece of information among many that help make a more informed credit decision about a consumer. Since we have that information available, Discover provides it free every month to customers to help them manage their financial well-being and gain insight into key credit information."
Discover would not disclose the exact scoring model it lists on customers statements other than saying it's a Transunion FICO score.
CBS13 turned to Transunion which told us it provides Discover a credit score using the FICO 08 scoring model, which FICO claims is the most widely used version of the FICO Score used by the majority of lenders in the United States.
Consumers can purchase their FICO score directly from MyFICO.com which FICO tells CBS13, is the FICO 08 model. However, Craig's MyFICO.com score pulled in early May was a 777 compared to the perfect 850 on his late April Discover statement.
Craig enjoys the idea of being perfect, but no longer trusts Discover's FICO score.
"I think it's very deceptive," he said.
"TransUnion provides Discover the credit score using the FICO 08 scoring model. It is important for your viewers to know that a credit score is a snapshot in a moment in time of your credit standing. Credit scores can fluctuate on a daily basis as updates are added to the file by credit providers. Not all credit providers report information on the same day to the 3 national credit reporting companies. It can occur anytime, typically during a 30-day window. Without having access to the referenced consumer's file and score, this could be the reason for the difference as well as you are comparing 2 different scoring models (Classic vs. 08) Clifton O'Neal, Transunion
FICO Statement on Achieving Good Credit
It is important for consumers to remember that the FICO Score is driven by the information in their credit report which is based on their credit history. Good behaviors - paying all bills on time every time; keeping credit card balances below 30 percent of available credit and only opening new credit when necessary - are what drives a person's FICO Score up or down. At myFICO.com, we continually re-enforce the concept that consumers should focus on these good credit management habits to ensure they have the best FICO Score possible. These are all things within their control. Which FICO Score is used doesn't matter as much as the person's credit management behaviors. Anthony Sprauve, FICO
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