sgip
Well-known member
Since we're in a purchase/refinance heavy market, I though it would be interesting to take a wholly unscientific poll on credit scores. Here's what I'm looking for. If you had a CreditKarma or other "non-credit report sourced score" at X, how much variance was there between X from CreditKarma to what the Bank had as their credit score?
Why? Here's how my conversations have been going lately:
Customer: I'd like a new loan. My credit score is 800
Me: Great! By the way, who provided the score?
Customer: Oh, I got the score from CreditKarma (AMEX/Discover/Chase/BofA/etc - they all use the same tool BTW) and it said it was 800.
Me: Hmmm. I'll use this 800 score to price the loan quote, but remember, once we run a report the score may vary. Using an 800 score here's your rate of 2.0%
Customer: That sounds great. Let's get started. You can run my credit.
Me: Um...We got your credit report. The FICO score is 709. Your rate is now 5%.
Customer: 5.00%???? YOU CAN DIAF FOR ALL I CARE!!!!
The score data that these companies provide is not applicable to mortgage credit score data. Think of it this way: When you want to buy a car, the dealer runs your credit. That report is filtered through a score model used for car loans. When you want a credit card, that report is filtered through a credit score model used for credit cards....and so on. Here's a very helpful article on the subject:
[url]https://www.investopedia.com/articles/personal-finance/103015/are-credit-karma-scores-real-and-accurate.asp[/url]
The difference in rate and fees between an assumed 781 score and a real 759 score can be significant.
What then have you found? Did your on-line score vary much from what the lender said was your middle score?
My .02c
Why? Here's how my conversations have been going lately:
Customer: I'd like a new loan. My credit score is 800
Me: Great! By the way, who provided the score?
Customer: Oh, I got the score from CreditKarma (AMEX/Discover/Chase/BofA/etc - they all use the same tool BTW) and it said it was 800.
Me: Hmmm. I'll use this 800 score to price the loan quote, but remember, once we run a report the score may vary. Using an 800 score here's your rate of 2.0%
Customer: That sounds great. Let's get started. You can run my credit.
Me: Um...We got your credit report. The FICO score is 709. Your rate is now 5%.
Customer: 5.00%???? YOU CAN DIAF FOR ALL I CARE!!!!
The score data that these companies provide is not applicable to mortgage credit score data. Think of it this way: When you want to buy a car, the dealer runs your credit. That report is filtered through a score model used for car loans. When you want a credit card, that report is filtered through a credit score model used for credit cards....and so on. Here's a very helpful article on the subject:
[url]https://www.investopedia.com/articles/personal-finance/103015/are-credit-karma-scores-real-and-accurate.asp[/url]
The difference in rate and fees between an assumed 781 score and a real 759 score can be significant.
What then have you found? Did your on-line score vary much from what the lender said was your middle score?
My .02c