I hear is changing its FICO credit score calculation. What changes, and how they will affect my score – TM, Phoenix
Are two changes FICO. Medical expenses in the collection will no longer affect the calculation. The score ignores other types of debt to collections, but has been resolved or pay off (Previously, payments, and with more than the initial balance of $ 100 in unpaid same set number). Please note that it may take a year or more lenders adopt new scoring model.
FICO credit reporting agencies began after a separate report unpaid medical debt changed the formula. “The only negative is in the collection of unpaid medical debt is not risk its reputation, the consumer,” said Ralph Anthony of FICO. This change can improve scores by as much as 25 points.
Other changes can make a greater difference. If your report is only negatives have been reported to the credit bureaus as collection accounts with a zero balance, the new formula can make your score, “flying over the roof,” said John Ulzheimer CreditSesame.com.
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