Influence: Media, Wikipedia
Wikipedia's errors regarding credit scores
Warning: You are caught in a confusing, weird feedback loop. Wikipedia says, "PLEASE BE AWARE THAT ANY INFORMATION YOU MAY FIND IN WIKIPEDIA MAY BE INACCURATE, MISLEADING, DANGEROUS OR ILLEGAL."
Wikipedia's falsehood, 9/25/07: "According to Fair Isaac the median score is 723 (half of scores above and below) whereas according to Experian (using the Fair Isaac risk model) the average credit score is 678 (lowest scores are farther from the median than the highest scores)."
Truth: Experian doesn't use the Fair Isaac risk model to provide a 678 average credit score statistic. It uses its own score model named the "PLUS Score."
The footnote "" links to a page titled "National Average Credit Score" at the web site www.money-zine.com. This is the second paragraph of that article (links included):
We're not going to hold you in suspense - the national average credit score is 678. That value is based upon research conducted by Experian, one of the three major credit reporting and scoring agencies. In fact, Experian uses the Fair Isaac Risk Model. You may be familiar with what are called FICO® credit scores. FICO is the credit model developed by Fair Isaac.
The first link leads to www.experian.com. That page (link included) states:
Experian credit score and credit report
The U.S. average credit score is 678.
What's your credit score?
Get yours online
The "Get yours online" hyperlink leads the reader to the page https://www.creditexpert.com/Order1.aspx which has an html title of "CreditExpert.com - Experian Credit Manager." It contains the sentence, "Yes! Please give me immediate online access to my PLUS Score and Experian Credit Report for only $15."
According to Experian, the "Experian-developed PLUS Score model is a user-friendly, consumer-focused credit score." Experian even has a hard time keeping its own score average straight: Is it 678 or 692? (9/28/07)
Fair Isaac calls its FICO score at Experian the "Experian/Fair Isaac Risk Model."
Experian spells it out with this statement from another one of its many web sites, freecreditreport.com: "The PLUS Score® is not a so-called FICO score, and may differ for a variety of reasons."
So, the PLUS Score is not the Fair Isaac risk model as stated by Wikipedia, and, more importantly, 678 is not the average FICO credit score. Different score, different scale, different statistics. Further, Fair Isaac uses only the median-- not the mean of the FICO distribution-- as a measure of central tendency. Consumers who think that their 678 FICO score is average are harmed through their false sense of security. Think "subprime mortgage meltdown/mess/debacle/implosion/defaults" and "credit crunch/crisis/turmoil/woes," etc. Think: Borrower dancing about his 678 when he is actually 45 short of the mere median, 723.
Wikipedia even argues with itself in the same article. In its "Score facts" section, it states:
Since the Fair Isaac Corp. provides the dominant scoring method, non-Fair Isaac method-generated scores often mimic FICO scores, (they often are derisively called "FAKO" scores). Although not as widely used, these scores (e.g. TransUnion's "TransRisk", Experian's "ScoreX", and "PLUS" scores), are less expensive for borrowers to buy than is the FICO score.
- The PLUS Score scale is 330-830. The FICO is 300-850.
- A syndicated Washington Post columnist states, "Experian calls its credit score product "PLUS Score" and is based on factors similar to but not the same as FICO."
- Experian illustrates (using the old "there are a thousand scores" line) the difference between PLUS and FICO.
- Fair Isaac fields the basic question: FICO, or Fake-O? Damning.
So, you can ignore Wikipedia, take it with a grain of salt, or change it. But, what's the point? If you change it, somebody else can just change your change.
See Fake-O FICO for stories of more of Experian's suckers like those at Wikipedia.
"Consumer reporting agency"
Wikipedia's falsehood, 10/13/07: "In the U.S., three credit reporting agencies (incorrectly called credit bureaus), Equifax, Experian, and TransUnion, calculate a borrower's credit score using their own different computation formulae."
In Wikipedia's article "Credit score (United States)," the words "credit reporting agencies" hyperlink to the Wikipedia article "Credit rating agency." But that article does not refer to companies that keep track of consumers' histories. Rather, it refers to companies such as Moody's and Standard and Poor's, which issue business credit ratings.
Further, in the very same sentence, Wikipedia blows it again by correcting those who use the term credit bureau, correcting them with another incorrect term, "credit reporting agencies." Rchamberlain made that up in 2006 and published it for the world to see, creating even more confusion. It's been there for over a year. The term in the Fair Credit Reporting Act that defines companies Equifax, Experian and TransUnion is "consumer reporting agency." More specifically, the FCRA refers to such a company as a "consumer reporting agency that compiles and maintains files on consumers on a nationwide basis."
Style edits before facts
Meanwhile, as the inaccuracy goes uncorrected, the debates rage on. See the downward spiral vs. vicious cycle controversy. (alt)
Wikipedia's search engine rankings for the search term credit score.
But, by far, the most deliciously ironic exchange is between a user and a Wikipedia "administrator." The average "Fair Isaac risk model" credit score is changed from one Fake-O average to another (678 to 692), and then it is changed back to the original Fake-O average. Hilarious. Seriously-- a real hoot.
A marking of one year of Wikipedia's obsession with the number 678. Press release.