FICO Score Changes

There are two changes that will affect the way your Fair Isaac Co. credit score is calculated. The first one affects how second card holders are handled. Previously, the second holder score was reported as the main card holder score. This will no longer be the case. The second holder score will stand as it’s own. Experian will change immediately, the other two will incorporate these changes next year. This will close the market of credit leasing. Where you could rent a person’s credit, with much higher scores than you, of course.

The second regards the “utilization of credit” as reported by Capital One. Previously, Capital One used the “highest purchase” method to report your utilization percentage. They will now use the actual credit limit to report utilization. This will benefit those who actually pay off the balance every month. Obviously this only affects the Capital One people. This could have a significant affect on your score, as it would be easy to get to maximum utilization very quickly.

How does your plastic report its utilization?

[tags]fico, credit, finance[/tags]