Consumer Comeback Blog

Just 3 Credit Scores? Why You Actually Have 49 FICO Scores

Written by Jeffrey Trull

Struggling to get your credit score under control? What if I told you that you have 49 different FICO scores to worry about?

Okay, so maybe you don’t need to worry about all of them. But it’s important to understand more about all of these scores, especially since your credit score can be reported differently depending on the source.

Here’s more on all the credit scores you might not have known about and how they impact your finances.

Why so many FICO scores?

Many consumers believe they have only three credit scores: one each from major credit bureaus (Experian, TransUnion, and Equifax). But it turns out that these bureaus generate more than just the basic FICO score that you’re probably thinking of.

So how does it add up to 49 total scores? John Ulzheimer from Smart Credit explains:

“FICO scores come in six different ‘flavors:’ generic, mortgage, personal finance, bankcard, installment score, and auto. Add to that the three different generations of the FICO score still available via each of the three credit bureaus and you can see how the numbers start to add up. ”

Generating this many scores does make sense for a few reasons. FICO scores are used to assign rates for various financial products. Naturally, the risk of extending a loan or a policy can vary depending on if it’s for insurance, employment, or a variety of loans. Plus, each of the three bureaus wants to have its own version, creating a bit of repetition.

But having this many scores isn’t necessarily fair to consumers. One problem: Consumers don’t know what score they’re getting when they pay to see their credit score.

The Consumer Financial Protection Bureau (CFPB) says in their 2012 analysis of credit reports: “Consumers should not rely on credit scores they purchase exclusively as a guide to how creditors will view their credit quality.”

If that’s the case, what should consumers rely on?

Consumers shouldn’t worry

It’s not all bad news for you and your 49 scores. Even though they may be different, they’re likely highly correlated. The CFPB report states:

“The CFPB found that for a majority of consumers the scores produced by different scoring models provided similar information about the relative creditworthiness of the consumers. That is, if a consumer had a good score from one scoring model the consumer likely had a good score on another model.”

All this is to say that having many credit scores shouldn’t change much or anything about how you handle credit.

How to deal with 49 scores

Now that you know how many credit scores you have, what should you do to make sure they’re all excellent? Here are some tips to keep in mind:

  • Don’t micromanage scores you buy. Obsessing over your FICO scores typically doesn’t make sense. Instead, stick to the fundamentals. Paying your bills on time, using credit responsibly, and using much of the other advice given here on the Consumer Comeback Blog will likely increase all of your credit scores.
  • Use your credit report. A credit score is just a number, and it’s based on a potentially more important document: your credit report. Check your credit report for accuracy to prevent mistakes that hurt your credit score.
  • Shop for credit. With so many different forms of your score, don’t take one lender’s word for your creditworthiness. Shop around for loans to get the best rates. Not only can lenders use different scores, but the same score may still result in different rates from different banks. Don’t get hung up on filling out a few applications for credit, either. According to the CFPB, FICO scores will go down by less than 5 points for an inquiry, which is a small price for saving money.

The moral: Use the same good habits to improve and maintain your credit score. If you do, it’s likely that you’ll have a good score no matter what model is used to calculate it.

For more about your 49 scores, see the graphic below from Credit Sesame.

Have you been confused by different credit scores? Did you know you had so many different scores?

Scores, Scores, Scores: How Many FICO Scores Do You Have?