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Myths > Scale and range > Myth 12

Credit score Myth 12: An 850 in mortgage lending

The highest credit score in mortgage lending is not 850, so striving for that number is a fool's errand #myth12

| By Greg Fisher

There is no 850 in mortgage lending because the highest credit score on any of the three scores' scales used in that industry is 844.

An 850 in the mortgage loan origination process is Myth 12.

Tone 1

From: Greg Fisher
To: Michele Lerner, freelance writer, Washington Times, Friday Home Guide and Home Section
Sent: Thursday,
January 27, 2011 2:34:21 PM
Subject: credit score, scale, 350, renewal

You wrote, "While debt-to-income ratios and the availability of funds for a down payment and closing costs also have an impact on a loan decision, lenders use an automated underwriting system that depends heavily on consumer credit scores, which range from 350 to 850."

Who is your source regarding the credit score scale?

Also, you wrote, "Credit scores are renewed once per month, but improvements to a score, depending on the reason for a lower score, can take months to appear, or even years in the case of a judgment or bankruptcy."

Who is your source regarding the once-per-month frequency of credit score renewal?

--
Greg Fisher
The Credit Scoring Site
creditscoring.com
PO Box 342
Dayton, Ohio 45409-0342


Acute power of intuition and incisive perception of Tone 1

From: Michele Lerner
Sent: Thursday, January 27, 2011 3:24 PM
To: greg@creditscoring.com
Subject: Re: credit score, scale, 350, renewal

Greg,

I appreciate your getting in touch with me with your questions about my article.

The range for credit scores comes from MyFico.com, although it looks like there was a typo in the article since the range is 300 to 850.

Gergg[SIC] Busch, vice president of First Savings Mortgage Corp. in Washington, D.C. is the source for the monthly score updates.

I assume from the tone of your email that you disagree with these statements.

If you have other information on this topic to share with me, please send it to me, since I always strive for accuracy in my work.

Thanks for your interest.

Michele Lerner
Freelance Writer
[phone]
www.MicheleLerner.com
[email]
"HOMEBUYING: Tough Times, First Time, Any Time" by Michele Lerner: order now at www.amazon.com

[END OF EMAIL]


Voodoo

The amazing ability to discern others' thoughts from simple declarative statements and questions is not limited to the eastern seaboard. For more on this sort of thing, see "Accuracy, transparency and integrity."

Beware: They live amongst us—those with this special power.



Here is a real lulu (Myth 9). Credit score company Fair Isaac did not even exist until 1956.

From: Greg Fisher [mailto:greg@creditscoring.com]
Sent: Thursday, January 27, 2011 4:03 PM
To: Johnathan Thomas, VP, Residential Lending, Virginia Commerce Bank; Johnathan Thomas, VP, Residential Lending, Virginia Commerce Bank; Gregg Busch, VP, First Savings Mortgage; Chris Dolan, managing editor, Washington Times
Cc: Michele Lerner, freelance writer, Washington Times, Friday Home Guide and Home Section
Subject: RE: credit score, scale, 350, creation date, renewal, Washington Times

Mr. Thomas:

The Washington Times states, "'FICO scores were created in the 1940s, but it took a long time, and the scores' reliability needed to be improved before mortgage bankers started to use them,' says Johnathan Thomas, vice president of residential lending for Virginia Commerce Bank in Chantilly, Va."

However, Fair Isaac claims, "FICO introduced the FICO score with Equifax in 1989."

What indicates the creation date of FICO scores?

Mr. Busch:

What indicates the once-per-month frequency of credit score renewal?

Mr. Dolan:

What is the Washington Times' correction policy?

--
Greg Fisher
The Credit Scoring Site
creditscoring.com
PO Box 342
Dayton, Ohio 45409-0342


Tone 2

From: Greg Fisher [mailto:greg@truthandfalsity.com]
Sent: Thursday, April 23, 2015 10:01 AM
To: Michele Lerner, freelance writer, Washington Times, Friday Home Guide and Home Section
Cc: V. Dion Haynes, editor, Real Estate, Washington Post; Editor, Real Estate, Washington Post; Jeff Scott (for Fair Isaac), IQ PR; Jeff Scott for FICO; Jeff Scott (for Fair Isaac), IQ PR; Tom 'Dr. FICO' Quinn; Tim Klein, vice president, Corporate Communications, Public Relations, Equifax; David Howe; Dominic Turano
Subject: RE: credit score, scale, 350, creation date, renewal, Washington Times II, Bezos #n551

[See this message and your response under Myth 6. Also, see "Washington Post" and "Washington Post."]

As they say, I'm with the media—and I'm a reporter on deadline (it is tomorrow)!

Ms. Lerner, you know that the scale of some credit score models is 300 to 850; we corresponded in 2011.

But you just wrote, "Turano says borrowers need a credit score of at least 700 or higher, out of 850, six months of mortgage payments - including principal, interest, taxes and homeowner's insurance - in cash reserves and a maximum debt-to-income ratio of 43 percent to qualify for a piggyback loan." #Myth6

Bzzzt.

If a credit score on a scale of 300 to 850 were 400, you wouldn't describe it as '400 out of 850,' now would you?

But I understand how this happened. I always thought 300 to 850 was a might bit peculiar, anyway. The range is 550 (850 minus 300), so it might as well be 0-550. Then you could write '400 or higher, out of 550,' and that would not be a false statement.

And, really, that's a much better perspective, isn't it? Better yet, how about 800 out of 1100? Better still, 73 out of 100!

This reminds me of giving every other street in Atlanta the same name in order to confuse the invading Yankees. That's where the first FICO score came from. They're still fooling us!

Unfortunately, that street-naming thing backfired. It got so out of hand, now even Equifax is confused:

1550 Peachtree Street, Northwest

1550 Peachtree Street, Northeast*

On the other hand, there is no 850 in mortgage lending, anyway (no 849, 848 (out of 850, or otherwise) or 847, either).

#TheRealBIGCreditScore

Right, Equifax? Right, Fair Isaac?

Remember, something is not true just because somebody says it is. Right, Equifax? Right, Dr. FICO?

Also, regarding history, in 2010 AD, Mitch McConnell was not the majority party leader of the upper chamber of the bicameral legislature of the country the United States of America.

creditscoring.com/influen...

The horrible thing about that word is that we don't even know which idiot wrote it. But at least we know which one owns it.

--
Greg Fisher
Truth and Falsity
truthandfalsity.com
Page A2
pagea2.com
The Credit Scoring Site
creditscoring.com
PO Box 342
Dayton, Ohio 45409-0342
skype fisher100
mobile/text 937-681-3224

PS. Mr. Howe has nothing to do with the unfortunate nonsense described in this message. It's just that he has the highest credit scores in the world, we've been talking recently and I thought that he might find this amusing.

PPS. What did you do about the errors in your 2011 Washington Times cover story? And, how is my "tone," this time?

* I would not have included a space between those lines, but there are (PageSpeed Insights tap target) rules, you see.

[END OF EMAIL]

Also, see "Some have no credit score."