     Christine Baker (Admin) | Thursday, April 05, 2001 - 11:26 am 
Barry,
I'm still waiting to get your fax number so you can review the report for the people who can't get their mortgage.
There are some other issues too:
1) Insurance inquiries are ignored?
Somebody recently posted that all insurance inquiries are ignored. I read through our previous correspondence about inquiries, and you never mentioned that. Who is right?
2) Paying collection doesn't increase scores?
You repeatedly confirmed that paying collections will NOT increase scores. Yet, I'm looking at score factors before and after paying a collection indicating that this is incorrect. (see my previous mail)
3) One 5 year old collection brings the Beacon score down to 571?
I would really like to fax you the entire report, but, I need your fax number. I believe that your software is NOT picking up that this account is a COLLECTION with the "Date of last activity" of 12/95 (as stated on the report), and INSTEAD calculates a score for an open account 120+ days past due. (see my previous mail)
4) What's the impact of Capital One reporting ONLY the "high credit?"
a) Often the reported "high credit" is LOWER than the current balance. It makes no sense, but I've seen that several times now. Will that be an "over limit" account for NextGen scores? What EXACTLY is the impact on scores?
b) Are the balances included in balance/limit ratios? Is the "high credit" added to the total credit available? Or is everything ignored?
5) What's the impact on your scores of missing ANY high credit or credit limit data?
Are the balances included in the balance/limit ratio?
6) How is the "Date of status" on Experian reports utilized?
I noticed that Experian utilizes a *Date of Status* which appears to be completely arbitrary. Is this date utilized at all in your scores?
Peoples' lives are ruined by the Fair Isaac credit scores, they are declined for mortgages, cell phones, pagers, long distance, insurance, ...
The poorer people are, the more devastating the impact of INCORRECT scores. As we now get to see the Beacon scores, evidence of software bugs is mounting and we need ANSWERS to our questions.
It is VERY important that we get CORRECT answers so that people can take legal actions against creditors and collection agencies who report incorrect and INCOMPLETE data, LOWERING the credit scores.
Obviously, if we don't get any answers from Fair Isaac, we'll have to sue for those answers first or we have to sue EVERYBODY: Fair Isaac, the CRAs, and the creditors. I sure am VERY tired of the finger pointing and wasting my time because I don't have the Fair Isaac documentation.
Sincerely,
Christine
------------------------------------------------
4/3/01
Subject: Urgent - ONE 5 year old collection destroys any possibility of conventional mortgage?
Hi Barry,
I'd REALLY like to get your fax number so I can fax you the entire report.
Additionally, from an unrelated case, pertaining to my statements that scores won't go up when collections are paid:
"Well it just has us wondering, 2 of her scoring factors changed with 2 weeks. The first codes were:
38:Serious delinquency, and public record or collection filed
14:Length of time accounts have been established
8:Too many inquiries last 12 months
2:Level of delinquency on account
Two weeks later balances remained the same, collection paid and student loan balance went down 40.00
Now the codes
40:Derogatory public record or collection filed
14:Length of time accounts have been established
8:Too many inquiries last 12 months
20:Length of time since derogatory public record or collection is too short
I find it odd that the first reason code went from 38 to 40 and the fourth reason code went from 2 to 20. These seemed to be associated with the collection account?? "
I find that VERY odd too, because you had told me repeatedly that paying collections won't improve the scores. It's starting to look like that's incorrect. What do you say?
I'd really appreciate your fax number and response.
Thanks much,
Christine
--------------------------------------
3/30/01
Subject: Urgent - ONE 5 year old collection destroys any possibility of conventional mortgage?
Hi Barry,
I've spent about 50 hours in the last 8 days getting the finger pointing from collection agency Inovision and Equifax, and finally everybody is pointing at Fair Isaac.
My client's credit report is FLAWLESS, except for a 12/95 $246 utility collection. While the account is reported as collection, it is reported with the tradelines as currently past due and 120+ days late. The date of last activity is 12/95.
Quote from my fax to Inovision and FTC complaint:
""I found that your INCORRECT reporting of the PECO Energy account is SERIOUSLY lowering his credit score.
"Credit score: 571
Source of score: Equifax (BEACON®)
Reason codes: 39 14 13 34
First Reason Code: 39 Your first reason code is 39, “Serious delinquency”. This is the single most important factor affecting your score. This reason appears when your credit report shows one or more serious delinquencies on your credit accounts. Studies reveal that consumers with previous late payments are much more likely to pay late in the future. There is no “quick” fix to improve the score if the serious delinquency indicated on your credit report is valid. However, as these age and fall off the credit report (credit account delinquencies stay on your report for up to seven years), their impact on the score will gradually decrease."
This above statement is a direct quote from Fair Isaac Company.
....."
It doesn't look to me like the impact is gradually decreasing at all.
The collection is currently unpaid, the statute of limitations expired over a year ago, but even if my clients pay the account, the scores won't increase. At least that's what you said last time we went over this.
Just got off the phone with Equifax, Lanette, 770-375-3114. She informed me that the account is reported correctly.
So, does Fair Isaac think my client deserves that score of 571?
ONE minor collection ruins someone's chances for a mortgage for 7 years?
I'll be happy to fax you the entire report, and much appreciate your explanation.
Christine |
| Christine Baker (Admin) | Thursday, April 05, 2001 - 11:56 am
I forwarded the above posting to Barry at Fair Isaac and added:
Barry,
I appreciate your voice message the other day, but aside from the lack of substance, I need a written response so it can be used as supporting documentation in court and for complaints with regulatory agencies. We already filed Equifax, FTC and AG complaints against collection agency Inovision, but have no documentation that the account is reported INCORRECTLY and that it is subsequently LOWERING the score to 571 with NO additional derogatory data.
Equifax stated that the account is reported correctly and that apparently your scoring software is causing the problem.
I would really like to fax you the entire report, but can't do so since I don't have your fax number.
If you can't answer my questions, please forward this mailing to your legal department.
Thanks much,
Christine |
| Christine Baker (Admin) | Friday, April 06, 2001 - 01:56 pm
I just had a long talk with Barry, unfortunately he won't give me a written response.
1) Insurance inquiries ARE ignored.
2) Paying collection doesn't increase scores?
Yes, BUT ... (see 3)
3) One 5 year old collection brings the Beacon score down to 571?
Yes. Just as I suspected: The scoring software is NOT picking up that this account is a COLLECTION with the "Date of last activity" of 12/95 (as stated on the report), and INSTEAD calculates a score for an open account currently 120+ days past due.
Barry suggested that the reporting be disputed. Of course we already did that. I consider that a software bug, Barry doesn't agree with that, but he said he would submit the issue to their development team.
Where does this leave people with those "bankruptcy" scores?
I'd say we request an FTC opinion letter. Either collection agencies like Inovision have to change their reporting OR Fair Isaac has to fix their software.
4) What's the impact of Capital One reporting ONLY the "high credit?"
The "high credit" WILL be used for calculating balance/limit ratios.
5) What's the impact on your scores of missing ANY high credit or credit limit data?
Are the balances included in the balance/limit ratio?
No.
6) How is the "Date of status" on Experian reports utilized?
I noticed that Experian utilizes a *Date of Status* which appears to be completely arbitrary. Is this date utilized at all in your scores?
Yes, it is, sometimes.
This is the one question that is still a total mystery to me. Barry said people should dispute it if they think it is not correct.
What IS not correct?
Barry thought if it's not the date it became the current status.
Based on that theory, a current account opened in 4/94 that always was current should have a 4/94 "Date of status"
BUT, that's NOT how it is reported!
I find that many times it is the same as the *LAST reported* date, and often it's a month or two older even though the account has been current for years.
The way I understand it, it won't be looked at if an account has always been current.
Whether that date is used in the scoring calculations depends on what the current status is and what type of account it is .....
We talked about this for a long time, I'm as confused as ever. Barry won't say exactly when this date will be used, but it IS used under certain conditions.
We agreed that it is up to Experian to explain.
7) How will LATE reporting affect the scores? Will the score be lower on the 1st than on the 30th?
NO. Creditors report in 30 day cycles and it is not unusual to see a couple of months lag.
When you have only one account and it hasn't been updated in months, you'll be lacking current activity/accounts, but it's not an "end of month" type calculation. If this is a delinquent account, then it will help your scores because it will be less recent. Makes sense.
8) Will accounts reported as OPEN but not updated in a year lower the score?
No, scoring considers it closed after such a long time.
Summary:
It's nice to get some answers. As the flops with insurance inquiries and PAYING collections show, we have to CHECK on those answers.
Trust, but verify.
We now know for sure that Capital One's NOT reporting the credit limit WILL lower the scores.
We also know that some collection agencies like Inovision circumvent ALL laws (SOL, FCRA, FDCPA, ...) by reporting in the tradeline section as CURRENTLY open and delinquent, causing these ridiculously low scores and essentially extorting payment for accounts with expired SOLs.
And we now have the first completely documented Fair Isaac credit scoring software bug:
Credit scores SHOULD ignore those current delinquencies for COLLECTIONS, but they do not -- the resulting scores are MUCH lower than the scores of people who discharged their debts through a Ch. 7 RECENTLY. |
| Ann (Momof3) | Friday, April 06, 2001 - 03:01 pm
Thanks for posting your results from Barry. Well it seems that my husband's report will remain unfairly scored, seems like everyone is pointing the finger and nobody is taking responsibility, clearly SOMEONE is to blame, of course proving that is virtually impossible.
I hope one day soon companies like Inovision will not be able to get away with this and who knows what other companies are doing the same thing. I also hope Fair Isaac examines their software and finds these bugs and fixes them.
There may not be hope for our situation, but I do hope these issues get resolved so noone else has to go through what we are going through. An old collection from 1995 should not destroy your score. |
| Cricket (Cricket) | Friday, April 06, 2001 - 06:07 pm
Christine,
I don't know what Barry at Fair Isaac you are referring to; but if it is Barry Papperno (can't remember spelling, sorry) I have his Fax number. I recently faxed my equifax credit report to Greg Borchardt and him for them to decipher. My problem is similar to this incident. A reaffirmed mortgage from a BK ch 7 is being reported as 60,000 delinquent each month although it is I1 (always paid on time), therefore bringing down the score. Anyway, the fax number Greg Borchardt gave to me is
415-444-5023.
Hope they respond.
Cricket |
| Christine Baker (Admin) | Friday, April 06, 2001 - 06:47 pm
Thanks, Cricket.
From what you posted I'd say it is CLEARLY the fault of the LENDER reporting the account as delinquent.
Have you disputed the delinquent amount with the bureaus and the lender? |
| Shylock (Shylock) | Saturday, April 07, 2001 - 03:58 am
How is Barry anyway?
Regarding date of status, if your account is a collection account then the date of status should show the first date of delinquency. If you've never been late then the date of status should be the month after you opened the account (the first time reported it will show I0 then I1 the next month).
What was the size of that 5-year old collection? A $30 collection from 5 years ago is a minor concern. A $2,000 collection from 5 years ago is a big concern. |
| Ann (Momof3) | Saturday, April 07, 2001 - 05:21 am
Shylock, if you are referring to our collection the amount is 246.00 from a former utility company. You would think a 1995 collection for that amount would not totally destroy someone's score, but that is exactly the case with us, everything else is in perfect standing. |
| Christine Baker (Admin) | Saturday, April 07, 2001 - 11:06 am
Shylock, Barry is totally overwhelmed with calls since the Beacon scores got released. Still has some humor, I should go work for Fair Isaac and subvert from the inside 
I'll try to segregate the various answers into their respective topics. What you said about the date of status makes sense, but that's NOT what Experian reports. |
| Shylock (Shylock) | Saturday, April 07, 2001 - 04:18 pm
The problem with disputing things that are inaccurate is that the CRAs may just erase the entry.
If you dispute the date of status there's nothing to stop them from just thinking, "I don't want to take the time to investigate this. I figure it's already a good reference for them. If they feel it's so bad then here -- let me just delete it for them." This has actually happened to me. The net effect was that my credit file history seems to be much shorter than it actually is.
Regarding the mortgage, how many inquiries does the person have in the past 12 months? |
| douglas pratt (Dougpratt) | Monday, April 09, 2001 - 12:11 am
when a lender promises to fix something, they often don't. once you get a person on the phone who tells you they're going to take an error off your credit report, get their name, and have them put it in writing. in the past i have asked them to fax the letter right away, which is still a good idea. once you have this in hand, ask them exactly when they are going to be reporting again to the CRA's; if they don't know, you may have to track down somebody who does. some creditors wait for weeks or months, so ask them to send a copy of the letter to each bureau. give them 30 days, and inform them that it's lawsuit city if they drag their feet. the new FCRA may exempt [UN]fair isaac from legal action- nothing has changed with respect to creditors and the CRA's themselves. they won't except the letter from you-- it has to come directly from the subscriber. if on the next cycle the derogatory entry still shows, here's what to do:
[substitute "collection agency" for "lender" or "creditor" as applicable.]
contact the attorney general in the state where the creditor is doing business. this isn't always where you send payments or call customer service; most credit cards list the issuing bank and where they are based. ask for a complaint form to be faxed if possible, or snail-mailed. fill it out, and enclose a copy of the letter from the lender who is continuing to report false information.
before FICO, this process ran much more quickly and efficiently. creditor letter directly faxed to the bank always did the job for me-- the new lender would see that the entry was wrong, and go on with the loan process ignoring it. everything must now go through the CRA process and the false information removed from all 3 bureaus before it will have its full effect on your credit scores. this is another good reason why FICO looks great on paper and stinks infernally in practise.
depending on the amount of your damages, you can hire an attorney and sue for triple the amount in contention. small claims is fastest, though if it is a great deal of money, take it into superior court. most states have a maximum dollar amount for small claims, around $5000, so if the mistake is less, sue for the max and offer to settle for full value, plus any legal costs you may incur. a letter from the attorney general usually brings resolution faster than you'll get a court date.
if a lender can document that they corrected the error and any of the CRA's insist on keeping it on your report, you can sue them. this is federal action, which means you don't have to deal with an out of state lawyer. filing fees, etc. can get pricey, so include it all. you can also complain to the FTC and US attorney. ask the lender for written proof that the CRA's have received their notice explaining that they have told the CRA to remove the derogatory. if they can't, and the CRA is still telling you the information they have is correct, chances are the lender lying to you. in the past in didn't really matter; now that credit scoring makes most lending decisions, getting all mistakes off the reports becomes critical. FICO forgot to tell the computer how to see a written letter from a lender that the debt is cleared and no longer outstanding, past due, or charged off.
as for getting a mortgage, if one spouse's score is high enough and the other's isn't, you can put it all under one name. you might have to go with a no-income loan if this affects qualifying; with a 680 FICO score you don't have to verify income at all, so long as you have a downpayment and the property appraises. expect your rate to be a half a point higher-- not super, but that sure beats a portfolio lender's product-- i can tell you from experience. my wife and i would do this now, but in spite of perfect credit and plenty of equity, neither of us can get FICO's quackware to spit out the magic number.
good luck. |
