Why average credit score?
The one thing I could never understand is the people fixation with average credit scores. Why would you care to know what is the average credit score in your state, in any other or in the entire country? It does not help you in any way, shape or form - yet you can find many sites that show you just that. Does living in the state with higher average score make you feel better? And when it comes to your own situation, for the vast majority of lenders, the most important credit score is the one at the middle.
If you need a mortgage, your potential lender pulls tri-merged credit report with scores from Equifax, Experian and TransUnion. That used to be called the FICO score, but since Experian is no longer associated with FICO, we can call it something else. Doesn't matter, you still have three different scores, e.g. 680, 690 and 730, and the mortgage rate, fees, etc. will be based on the in-between or middle credit score of 690, not the mathematical average credit score of 700.
The reason you have different credit scores among the three credit agencies is because each uses slightly different scoring algorithm, gets somewhat different data and weighs that data a bit differently from the others. The credit scores can be as close as few points or as far as 50 or 60 from each other. Again, the only one that really matters is the credit score in-between.
And if you apply for something less significant than home mortgage, a car loan for example, one credit score is all a dealership financial person typically looks at. No need to worry about average credit score here.
Wed Sep 14, 2011 11:09PM | Copyright: www.bad-credit-advisor.com | More in Credit Score Help | Comments (0)
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