Fair Isaac, the manufacturer of the popular FICO score, announced that one of the major credit bureaus will begin offering a new version of the score FICO called 08. the new rating methodology should reduce some scores while improving others.
The new FICO 08 was created to provide more precise pointing for consumers with limited or damaged credit history that may pose a greater risk to lenders and consumers with more established credit. According to Fair Isaac, the net result of the score change is that consumers with more established credit history should see a slight increase in their credit score when calculated using the new methodology.
The problem is that this will probably be a long time until this scoring system is widely used. Lenders generally test score any change widely before starting to use them for important lending decisions. In addition, TransUnion is the only one of the three credit bureaus that offers the FICO score 08 as an option for lenders. Equifax will begin offering FICO 08 laster this year. It is unlikely that Experian will be offering this new time of partition when the company is currently engaged in a dispute with Fair Isaac.
The original score FICO continue to be the score that lenders use most for the foreseeable future. Equifax offers a FICO score free when you sign up for a free trial of credit monitoring service. You can learn more about Equifax and other credit report monitoring services at NextAdvisor.com.