Joanne

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This means that you do not have enough reported credit for a score to be provided.  I would recommend going to your local credit union/bank and getting a secured credit card or two, if financially feasible.  This will provide your report with positive tradelines. 

Brian C. Aber
Senior Account Executive – HTDI Financial Charter Board Member – National Association of Credit Services Organizations brian@htdifinancial.com
877-877-4834 x704

Its states that a consumer finance companies typically grant loans to people with poor credit histories. 

The only consumer finance company I have on my report is Ford Credit, an automobile loan. 

Why would this affect my FICO scroes?

Georgia

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Hi Georgia,

You’ve answered your own question within the question: “consumer finance companies typically grant loans to people with poor credit histories”.  Don’t worry too much about it, though – it’s not a major factor.  It’s contained in a portion of FICO called “Types of Credit” that accounts for the lowest percentage of your total score.

If given a choice, however, avoid any other loans that will result in a finance company notation on the report.  Furniture store loans and any ‘buy now pay later’ types are at the top of the ‘no-no’ list.

Thanks for the questions and hope this helps.

Paul

The Raise Your Credit Score seminar for 2008 is available now!

It’s fifteen-minutes of important preemptive actions you can take to improve your credit score before applying for that mortgage, car loan, job, insurance, etc. 

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After you’ve improved your credit score, make sure you tell others about our site!

I truly believe in the information on this blog and would like to know if this other person knows what they are talking about.  Please respond

J.A.

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Hello J.A.,

The June 5, 2007 article was a copy of a press release from Fair Isaac:

The adjustment removes authorized user accounts from consideration by the scoring model in FICO 08, the newest version of the Classic FICO credit score which Fair Isaac expects to become available to lenders starting in September.

That never happened.  The FICO 08 model hasn’t been released yet.  The WSJ brings us the latest news from December 18, 2007 regarding the release of the FICO 08 model:

Consumers could start seeing the new FICO scores by the spring, though some lenders may take additional time to test the system to see how it works with their business and loan portfolios. Fair Isaac, which last revamped its scoring model earlier this decade, says it is accelerating its FICO 08 rollout, partly in response to lenders’ demand for better risk-management tools.

Here’s an interesting footnote to all of this.  Most mortgage automated underwriting systems use the Classic version of FICO.  Fair Isaac developed an arguably superior model several years ago called NextGen and despite Fair Isaac’s attempts to market NextGen, FNMA and FHLMC still stick with Classic to this day.  And, to my knowledge, VantageScore isn’t utilized by many (read: any) mortgage lenders.  So, now we hear that there is a new FICO 08 version slated for Spring 2008.  OK, that’s nice, BUT…

When will Fannie Mae and Freddie Mac adopt the FICO 08 model? 

My guess is not immediately.

You will notice that there is a footnote at the bottom of the Broken Credit Blog’s older Authorized User articles that reference that June 5, 2007 FICO press release.  I want to thank you J.A. for your question.  I’m going to add a footnote to that June 5, 2007 article referencing this article.  The Authorized User strategy continues for the time being.

Thanks for the questions and hope this helps.

Paul

It’s discovery time and Fair Isaac wants a peek at the recipe for VantageScore.  The following excerpt is from a September 25, 2007 ruling:

“On January 12, 2007, Fair Isaac served discovery requests seeking “the algorithm and the software and process used in conjunction with the algorithm to produce a credit score.” Schlosser Aff. [Docket No. 86] Ex. A. at 3. On April 25, 2007, Defendants moved for a protective order precluding discovery regarding “the actual model, design, algorithm, computer program, portions or drafts thereof and numerous other materials that would reveal the actual model, design or computer program (collectively, the ‘Algorithm’), used by Defendants in calculating the VantageScore credit score.” Mem. in Supp. of Defs.’ Mot. for Protective Order [Docket No. 84] at 1-2. Simultaneously, Fair Isaac moved to compel production of VantageScore’s algorithm and related documents.”

And U.S. District Court Judge Ann D. Montgomery says: “Defendats’ Consolidated Objections [Docket No. 179] are OVERRULED”.

I wonder if “Trans Union admitted in its Answer that “certain Trans Union employees who had access to Fair Isaac’s confidential information participated in the planning of VantageScore . . . .” had anything to do with it? 

What do you think [rhetorical]?

Once again I say: Can’t we all just get along?

About 3 years ago, my husband and I decided that we wanted to fix our credit report, and logically, at tax-return time we paid off all accounts that were in collections. 

We thought that this would help us, but our credit report seems to have stayed stagnant. 

We got a mortagage since (in 2006) at a decent rate, but only after much shopping (we wanted fixed rate). The mortgage isn’t even helping our FICO. 

All of our accounts that we paid off state Charge off in current status, and Paid charge-off in comments. 

We currently have NO credit cards, no auto loans, and we pay our student loans on time.  We recently tried to get a credit card (hoping to raise our FICO), but were denied. 

What can we do to raise our credit score?  How can we get the creidt that we need to get in order to raise our FICO so that we can get credit?

Thanks,
Pam

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Hi Pam,

Goodwill letter the paid charge-offs and open three secured credit cards.  A credit limit of $300 each is fine.  

Keep in mind that some outfits offer ‘secured credit cards’ that don’t report to the big three CRAs – obviously, that would not be a benefit.  Last I checked, Bank of America, Fifth Third, and Colonial Bank offered decent deals on secured credit cards. 

Once the cards are open, charge them in the first month and then pay them off entirely.  In six months time, your score will be wonderfully improved.

Thanks for the questions and hope this helps.

Paul

P.S. Please report back in six months so that we can add to this post.  The Broken Credit Blog becomes a lonely place otherwise.

I have a total of 20 collections on my report from the same collection agency, all medical, and he deleted all but 1 that still has a balance. The one that remains is one of the oldest as well, 2002.

I had filed a dispute with all 3 MCB as he had asked me to do and yesterday they contacted me that all had been deleted. How long will it take for credit score to reflect the changes?

I am looking to buy a new vehicle to accomodate my handicapped son so hoped you could help..Thanks in advance and wow what a great site.

Sandy  

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Hi Sandy,

Great job!  By the way, your credit score already reflects the changes.

I love to hear good news!

Paul

Chuck

———————–

Hello Chuck,

It has to do with the timing.  First, paying an old collection will likely reduce a credit score.  On the other hand, if the collection originated within the past two years, then you may see an increase in your FICO when it is paid.  Hold the phone – we’re not done with this.  The problem is that the credit reporting tactics of collection agencies have the effect of making these items appear more recent than reality and the most egregious example of this is re-aging. 

In conclusion, this is the credit reporting system we live with.  These are the collection agencies we deal with.  The Broken Credit Blog fights for consumers.  Pay for delete is a solution for many.

Thanks for the questions and hope this helps.

Paul

P.S. Of course there are many other solutions in the Broken Credit Blog’s credit repair library.

• Why errors exist on credit reports
• How to obtain a copy of your free credit report
• The proper way to dispute inaccurate items
• How to re-age a derogatory account to delete the derogatory history
• How to remove collection accounts from your bureau
• How to improve your credit score even if you have no bad credit

This free online seminar is for anyone who desires to improve their credit score THE RIGHT WAY.  Broken Credit, LLC has seen a tremendous need for the general public to have this information and it is our great pleasure to bring this seminar to you for free.

For those of you who will be buying or refinancing a home, this free thirty minute seminar could make your dream of homeownership possible and save you tens of thousands of dollars in interest!

Register & Watch Today!

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Hi Deandra,

The Authorized User will soon become a credit repair dinosaur.  Experian will be the first to effectively make the AU extinct beginning next month.  Equifax and TransUnion are expected to follow suit next year. 

The joint cardholder will replace the AU strategy and works the same way.  When the card arrives, you will want to make a small charge and then pay that amount off entirely upon receipt of your first statement.  I’d say you could cut the card up at that point, but the joint cardholder is different in that regard.  For one, you will now both be guarantors for the credit card payments [whether good or bad].  And secondly, the joint cardholder requires an underwriting approval [the AU does not].  I say not to let either of those scare anyone, just consider this.  The potential for a credit score increase of 50+ points is a tremendous gift, only now, that gift comes with responsibility.

Thanks for the questions and hope this helps.

Paul