Even People With Good Credit Are Penalized
Below is a MRR and PLR article in category Finance -> subcategory Wealth Building.
Even Those With Good Credit Face Challenges
Title:
Even Those With Good Credit Face Challenges
Summary:
Everyone is familiar with the Vantage credit scoring system developed by Equifax, Experian, and TransUnion. This system rates consumers from A to F. Despite extensive research, it's still unclear how lenders will use this score compared to the FICO score, or which lenders will prefer Vantage over FICO.
Will lenders analyze the actual score or just go by the A-F grade? Unfortunately, the answer remains uncertain. When applying for a loan, it's crucial to ask which credit score the lender uses.
Keywords:
financial advice, credit rating, debt-free, get out of debt
Article Body:
Most people are now aware of the Vantage credit scoring system introduced by Equifax, Experian, and TransUnion, which rates consumers from A to F. Despite thorough research, we still don't know how lenders will utilize this score compared to the FICO score, or which lenders might favor Vantage.
Will they take a flexible approach and analyze the actual score, or simply consider the grade? Unfortunately, this remains unresolved. When applying for a loan, always ask which credit score the lender refers to.
I recently refinanced my home, and the lender used my FICO score. I obtained my credit report and scores from the three major bureaus, anticipating high scores since I've avoided late payments for a decade. My scores were above 760.
While attempting to order an Experian FICO score, I could only get a Vantage score, which was 819. Surprisingly, I received what seemed like unreasonable explanations for my scores not being higher:
1. Missing Real Estate Loans: Incorrect, as I’ve had a mortgage for seven years.
2. Low Available Credit: I have one credit card with a $3,000 limit; apparently, more cards would improve my score.
3. High Balance-to-Limit Ratio: My credit card balance was around $900, just 30% of the limit?"ideal by most advice.
4. Short Revolving Account History: Inaccurate, as I’ve maintained my credit card account for 10 years.
5. Multiple Inquiries: I had only three inquiries?"within acceptable limits?"but was penalized for having two in a year.
I disputed these points with each credit bureau and received responses from two, awaiting the third. Once I have it, I'll reorder my report to see if my scores improve.
It seems reaching an 800 FICO score is becoming increasingly difficult, with credit bureaus appearing to keep scores lower than they could be.
I urge everyone, irrespective of your credit standing, to order your credit report annually. Review every detail and ensure it's accurate. Even minor discrepancies can mean the difference between approval and denial. Those few extra points on your credit score can be crucial. Good luck!
You can find the original non-AI version of this article here: Even People With Good Credit Are Penalized.
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