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Converting to the Newer Score Version

So why don’t lenders simply switch to the newer version once it’s released?  The latest FICO version, called FICO 8, was released for lender access in 2008-2009, but not all lenders are switched over to that latest version—note, FICO recently shared that approximately 6,000 lenders are now using FICO 8.

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Some lenders do make the transition to the newer score version relatively quickly, but the majority of larger lenders want to first analyze the newer score to thoroughly understand how it will work for them. Some of the review processes include:

  • Proving via their data and portfolios that the newer score effectively predicts future credit risk.
  • Using measurements and quantification to ensure that the newer version is a better score (more predictive) than other credit score versions currently in use. (Why go through the effort of converting if the newer version is not more predictive on their portfolios?)
  • Understanding how the newer version interacts with the other scores and analytic criteria the lender is using in their processes to review new credit requests.  This needs to be conducted for the various loan portfolios (mortgages, auto loans, credit cards, lines of credit, etc.) as well as on a bank-wide perspective.
  • Ensuring all compliance and regulatory parameters related to score use are reviewed and approved.
  • Making any system changes required to operationally access the score and seamlessly integrate into score use strategies.

A project this large takes time, resources and prioritization. It is important that the lender has everything lined up and ready to go when they flip the switch to the new score version. By the time some lenders have completed this work, it’s time to start again as the score vendor may be just about to release the next redeveloped version!

The score vendor and credit reporting agency partner then need to determine when they will make that most recent version available to consumers. In my opinion, it makes most sense that the version made available to consumers is the same version that the majority of lenders are pulling to make credit decisions. That way, there is a higher probability that the consumer is seeing the same score version that most lenders are seeing.

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  • Devin Bent

    A big problem with Vantagescore:

    Through a service purchased from USSA I have daily access to my scores and the underlying reports. These are — as I understand it — Vantagescores. I have found one lender — USAA — who uses the Vantagescores for mortgage decision-making. For reasons not pertinent here, I can’t use USSA.

    How do I find another institution that uses Vantagescores. I emailed and phoned Vantages scores — the first email two days ago without any answer at all. I asked USAA. They don’t know.

    If I call individual lenders, the people who answer phones or email and their supervisors don’t know anything. Even the persons who talk loans don’t seem to know about scores except that they use some. I can’t have them do hard pulls — I’ll just rack up hard pulls and destroy my credit rating.

    I read a Vantage press release that Chase uses them. I went to the Chase website and used their estimator that asks for FICO.

    So have I bought scores that can be used with only one lender?

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