Somebody, please, help these experts. The consumer can't take much more expertise and help.
What is the FICO credit score scale?
The FICO credit score scale is 300 to 850. So, the range is 550 (850 minus 300).
And, here come conflicting statements from the FICO credit score company, itself. On July 22, 1999, at the Federal Trade Commission's "Public Forum :
The Consumer and Credit Scoring" a Fair Isaac representative entered the following into the records:
Well, there are many different credit scoring systems. In the Fair, Isaac credit bureau systems, which is probably what you've got in mind, the range is from somewhere in the low 300's to something close to 900. Again, you don't see many 900's. You don't see many 325's.
Today, according to Fair Isaac, you don't see any 900s.
Here's Fair Isaac, again, on June 22, 2000 in an online chat "Color of Money Live With Michelle Singletary - Credit Scoring with Craig Watts of Fair, Isaac and Company, Inc.":
FICO scores range from the 300s to the 900s, with scores at either end being very rare.
Not an insignificant event. That's when we found out that "close to 900" meant over 900, too. Imagine the time wasted by the 850s who thought they could get to 900. And these have to be some of the smartest people in America, whiling away their hours worrying about a ghost when they should have been solving big problems, creating a better world.
Consumers' understanding of credit scores
Fair Isaac loves statistics. It's a statistics company, so there's nothing weird about that. Here's one: "49% do not understand that credit scores measure credit risk."
But the company's 2004 booklet "Understanding Your Credit Score" states, "FICO scores range from about 300 to 850."
About 300? Is it 300 or not? This isn't just some ranting boob with a web site going off half-cocked, this is the company that created the score.
No wonder 49% don't get it.
The FICO score distribution chart doesn't list an 800-850 category. It's "800+." And that segment is more crowded than it was before. Now, 13% have scores of 800 or more, up from 11%. You're not so special, anymore.
The FICO score medallion
So, maybe things in the fancy secret algorithm changed. Or, maybe they just decided to lop off the tails of the distribution to stop the madness. Fair Isaac's public response (or, perhaps, the new-and-improved, Fair Isaac ad agency's response) to all this was to create an icon that says it, once and for all: "300-850."
It looks like a cross between a gold embossed foil seal on your diploma, a foot race medal, and the Good Housekeeping Seal.
300 to 850? In this system of winners and losers, why can't you get a score higher than 850? What if everybody gets an 850? Does that mean there is almost no risk? Do they bring back the 900s? Will the American consumer become the best investment in the world, dragging rates to even lower all-time lows?
Proclamations of the FICO score scale
At the risk of creating more confusion, these quotes are submitted for your amusement. This stuff is dry enough.
Federal Reserve:
My files
contain the statements of four different
experts who describe the
range of scores in the basic Fair
Isaac (FICO) model as 300 to 900,
400 to 900, 336 to 843, and 395 to
848. If product offerings are such
that the “experts” can’t agree on
basic information, how can consumers
be expected to gain a meaningful understanding of the
scoring process and its impact?
"In the Fair, Isaac credit bureau systems, which is probably what you've got in mind, the range is from somewhere in the low 300's to something close to 900."
U.S. Department of the Treasury: "The acronym FICO comes from the name of the company that developed the leading credit scoring model – Fair Isaac Company of San Rafael, California. FICO scores range from 350 to 850, with higher scores indicating better past credit performance."
U.S. Department of Agriculture: "FICO scores generally range between 300 and 900."
UNITED STATES BANKRUPTCY COURT NORTHERN DISTRICT OF CALIFORNIA: "The top FICO score is 800."
Consumers Union, non-profit publisher of Consumer Reports: "Credit scores range between 900 and 300."
ABC News: "... it was just 598 on a score of 300 to 800."
CNN
CNNfn, CNN/Money: "Most consumers score between a 300 and 850." (In the FICO model, all consumers have scores on the 300 to 850 scale, unless they don't have a score, at all.)
"Scores generally range from 300 to 850... " (Money Magazine, 6/21/07)
"Scores can range from the 300s to about 900, though most borrowers fall in the 600-700 range."
"Typically, the score is reported on a scale of 300 to 900."
Money Magazine, February 19, 2003: "Scores range from 350 to 800 points; scores of 620 and above are considered good."
U.S.News & World Report: "Risk scores generally range from 300 to 950... "
Essence: "A credit report is a snapshot of your debt-paying activity; your credit (FICO) score--a number ranging from 350 to 850—predicts whether you're a good credit risk (above 620 is considered respectable)." (alt)
Clark Howard: "The score was created by the company, Fair Isaac, and it is based on the likelihood that you will pay your bills. The score of 720 or above means you’re in great shape credit wise. The average score in the country is 678."
The Mortgage Professor: "FICO scores range from 350 to 850."
"The typical range for credit scores is between 375 and 900, with 375 indicating a poor credit risk, and 900 indicating a high liklihood that any credit extended will be repaid as agreed, although there is a lot of disagreement as to what the bottom and top numbers of that range truly are."
Ameriquest Mortgage: "Credit scores range from 350-850."
"Raw credit-bureau data is fed into the software to yield scores from 300 to above 800."