How FICO Scores You Based On Peer Profiling

In the FICO scoring model you may not be aware that you are compared to other consumers with like credit issues as appear on your credit report. So, rather than comparing you with everyone who has a credit score, you are measured against consumers with a similar credit profile. The FICO scoring model is broken down into several mini models. These miniature models are referred to as score cards. The current version of this model has 12 score cards. Each one of these score cards is designed to assess risk among like groups of consumers. FICO does not publish a complete list of their score cards. However, what we do know is that this list includes categories/score cards such as:


  • Consumers with bankruptcies
  • Consumers with derogatory accounts
  • Excessive inquiries
  • Clean report and long history
  • Minimal or few accounts


Although these fields may have a slightly Vegasgoal different name, these are some of the general areas that FICO uses to compare you to your peers and come up with a number value that represents your credit score. Two of the most significant factors that remain a constant are payment history and revolving debt ratio.

The term score card hopping is used in the industry to denote movement from one score card to another. Based on an event, a consumer may move either up to the next higher card or drop down a score card. Ultimately, the idea is to move higher. A good way to explain this is, you may have a group of consumers who all have derogatory items on their reports which places them all together on one score card. In this example, if one of these consumers decides to pay off or otherwise get these derogatory accounts removed or cleared from the report, this will push the consumer up to the next higher card. This is where it can get tricky. In some cases if a consumer moves up to the next higher card it may cause the credit score to go down. This is due to the fact that they are now at the bottom of this next height card and may not compare as strongly in other areas to the consumers above them on this new score card.

So moving up from a “derog” card to a “clean file” card may take some time to reach a more satisfactory comparison, but well worth the wait. The analogy I like to use is it’s like going from the top of your general mathematics’ class in high school to Algebra 1. You will likely not be the top dog in class for a while. There is really no way to know when you are moved up or down on the score card model, but just know that any subtle changes to your report will likely push you either up or down. For example, if you have had 5 inquiries in 30 days versus someone who has had only 3 over the last 90 days, this activity on your part can cause movement to the next lower card. Filing for bankruptcy will land you on the bankruptcy score card.



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