FICO’s new credit scoring model could boost your score


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You have a stellar banking reputation. You’ve been with your bank forever, and you have plenty of funds in your savings account.

Previously, this wouldn’t factor in your FICO Score. In the future, that may not be the case.

FICO, Experian and Finicity announced on Monday a new type of FICO Score – the UltraFICO Score – that may give consumers the ability to have their banking history help them earn credit approvals.

The new score is scheduled to launch as a pilot program in early 2019 and should be broadly available to lenders in mid-2019.

Here’s what banking info is included

The banking criteria includes how long your bank account has been opened, frequency of activity and evidence of saving. The information is read by Finicity and combined with Experian’s credit information.

The UltraFICO Score pilot relies on financial data being shared to potentially increase your credit score. This financial data is obtained via consumer permission.

The new score could lead to more credit approvals for people who have credit scores in the upper 500s or lower 600s. Consumers who have a limited credit history or those who are rebuilding their credit should benefit the most from the new score, according to FICO.

The addition of banking history may give a borderline candidate an opportunity to qualify when they wouldn’t under today’s guidelines.

“FICO says 7 in 10 consumers with average savings of $400 without negative balances in the past three months will see an increase in their score,” says Ted Rossman, industry analyst at

Potential impact of the new scoring model

The traditional five factors of a FICO score are payment history (35 percent), amounts owed (30 percent), length of credit history (15 percent), credit mix (10 percent) and new credit (10 percent). Before the UltraFICO Score, amounts owed was the closest that a credit score category came to looking at a consumer’s finances.

“The possible unintended consequence of including bank account balances would be an increased focus on income and assets,” Rossman says. “Historically, your FICO score has been affected by how well you manage your money, not how much money you have.”

These changes give consumers more control over the information that’s being used in making credit risk decisions, Jim Wehmann, executive vice president of scores at FICO, said in a press release.

“It also enables a deeper dialogue between the consumer and lenders to help both parties make better financial decisions,” he says.

Still, Rossman offers a word of caution about increasing approval rates.

“While this generally sounds like a good thing for consumers, the concerning part — the solution in search of a problem, if you will — is the focus on boosting approvals,” Rossman says. “Fairness is a good goal. Going in with the idea of increasing approval rates is a slippery slope.”

Another potential consequence: The UltraFICO may lead to more unsecured credit card approvals while lessening the need for secured credit cards for borderline candidates. This could free up funds that a borderline candidate might have been forced to deposit as collateral for a secure credit card. Now, those funds could be moved to an emergency savings account.

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