The three major consumer credit reporting agencies announced Tuesday that
they have created a new credit score aimed at simplifying the loan process
for both lenders and borrowers. The announcement by Equifax, Experian and
TransUnion said the new "VantageScore" was a direct result of market demand
for a more consistent and objective approach to credit scoring. The agencies
in the past each provided their own scores, meaning that a lender dealing
with a consumer's application for a credit card or a mortgage might have to
reconcile three different scores. The scores are important because they
measure how much debt a consumer is carrying and how well the consumer keeps up with bills.
The higher the score, the more creditworthy the consumer is considered and
the lower the interest rate the consumer is likely to be charged. The three
credit agencies termed the move to a unified score as "unprecedented. In its
joint announcement, the agencies said: Under the new scoring system, credit
score variance between credit reporting companies will be attributed to data
differences within each of the three consumer credit files and not to the
structure of the scoring model or data interpretation. The scores will range
from 501 to 990. The top end is slightly higher than scores currently in
use.
The credit reporting agencies are operated by Equifax Inc. of Atlanta,
Experian Information Solutions Inc. of Costa Mesa, Calif., and TransUnion
LLC of Chicago.
On the Net:
http://www.equifax.com
http://www.experian.com
http://www.transunion.com
Posted by Donald Urschalitz P.A. at March 10, 2006 11:00 AM
