Fair, Isaac, Equifax team up, provide consumers full access to FICO scores

SAN RAFAEL, Calif. and ATLANTA - It's taken months of dissension and debates that pitted Fair, Isaac and Company against consumer advocates, online lenders and state legislatures who argued that consumers should have online access to their credit scores. Last week, Fair, Isaac and Company, together with Equifax launched an online credit score delivery service for consumers that provides them their individual Fair, Isaac FICOT credit risk score. FICO scores are the industry standard used by lenders to make billions of credit decisions annually, including more than 75% of mortgage loan originations. In addition to having immediate, on-demand access to their FICO score via the Internet using the new Score PowerT service, consumers who purchase the service will also receive their Equifax Credit ProfileT, which their FICO score is based on; a personalized analysis of the score including the top four reasons for their score; suggestions for improving and maintaining their FICO score; and an 800-number and e-mail address they can use if they have questions. Consumers will be able to access their FICO score information online at www.equifax.com or www.myfico.com. Mike Cummins, general manager, Equifax Consumer Direct said the information will be delivered "almost instantaneously" and will remain available to the consumer online for 30 days from the order date. Cheri St. John, general manager for Fair, Isaac Global Alliances said the analysis consumers will receive with their FICO score is crucial because there could be a number of reasons why a consumer's FICO score is what it is. Past payment history and the level of balances outstanding account for two-thirds of what the FICO score is based on, she said. Other factors evaluated are the amount of time the consumer has had credit, the number of new credit inquiries they've made, and the types of loans that are outstanding. "There are a wide variety of reasons why a consumer's FICO score could be high or low, and that's part of the reason why Fair, Isaac has advocated that it's so important that consumers receive a detailed explanation of their scores and not just handed their FICO rating without fully understanding how their credit behavior affects their scores," St. John said. That issue has been the core of a heated battle that was sparked by a decision in March 2000 by online mortgage lender E-Loan to provide consumers their FICO score as part of the company's "My-E-Loan" service, in cooperation with electronic credit information provider Credit InfoNet. Fair, Isaac contended that E-Loan took the action against their expressed wishes. In April, Equifax stepped into the fracas and demanded E-Loan cease providing consumers their FICO scores. To make good on its demand, Equifax cut off credit scoring service to nearly a thousand customers of Credit InfoNet. When Trans Union LLC threatened to do the same, E-Loan conceded and notified consumers that the company was discontinuing its "tell all" FICO score policy. E-Loan, however, maintained its position that consumers have the right to view their credit score (CU Times May 3, 2000). In June 2000, Fair, Isaac made public a comprehensive list of factors used in its FICO credit risk scores. The company said the service was intended to "demystify" the credit process. But the debate didn't end there, it moved into the state and federal legislative arena. Last year, for example, California Gov. Gray Davis signed credit score disclosure law into effect that among other things, requires disclosure to consumers of their FICO scores; the name of the person or entity that provided the credit score and instructions for contacting the credit bureaus; and if a mortgage application is rejected, the reasons why. On Capitol Hill in Washington, Reps. Chris Cannon (R-Utah) and Harold Ford (D-Tenn.) and Sen. Charles Schumer (D-N.Y.) have championed tough federal credit score disclosure laws. St. John said the announcement about Score Power "is not an indication of any reversal by Fair, Isaac of its position concerning releasing FICO scores to consumers. We've taken the steps to respond to consumer demand." Ed Mierzwinski, consumer program director, USPIRG is not appeased by Fair, Isaac's change of tone. "The credit score company Fair, Isaac and the credit bureau Equifax shouldn't be praised for their new program disclosing credit scores for a fee, they should be criticized for the years they spent lobbying Congress and the Federal Trade Commission not to require that credit scores be disclosed as part of credit reports." Mierzwinski charged that, "The announcement by Equifax and Fair, Isaac is really part of a calculated campaign to prevent passage of federal free credit scoring disclosure legislation." -ekingoff@cutimes.com