FICO Expands its Free Credit Score Program to More Consumers

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We support reforms to the financial marketplace that protect consumers from unscrupulous banks and lenders.

By Consumers Union on Tuesday, July 15th, 2014

Looks like consumer demand for more access to free credit scores is catching on: last month, Sallie Mae announced that it was joining FICO’s Open Access program, meaning that it will provide a free credit score each quarter to borrowers who take out “Smart Option” private student loans in the 2014-15 school year. According to the press release, Sallie Mae is the first national private student lender to participate in the FICO Open Access program.

FICO first unveiled the Open Access program in November 2013, and began to provide FICO scores to credit card holders of First National Bank of Omaha and Barclaycard US. FICO’s program not only helps those consumers who would otherwise purchase a credit score save money – consumers usually have to pay about $20 each for their FICO scores from each of the big three credit bureaus – but it provides consumers the score that the lender actually consults when evaluating them for credit. This is good for consumers, who can’t be sure that the credit scores they can buy or access for free online are the same ones used by their lenders.

Consumers deserve to know the scores that banks and other lenders are using to set interest rates and make other credit decisions about them. As we wrote back in November, we think FICO’s Open Access program is a good first step toward making sure consumers can easily access their credit information. The Consumer Financial Protection Bureau (CFPB), too, has demonstrated support for this type of initiative, and sent a letter to top banks asking them to provide consumers with the credit scores they used at no additional cost.

But so far, these scores are only available to a small subset of consumers – just those customers at specific institutions. Even the new Sallie Mae plan only applies to new borrowers – so if you already have a loan with Sallie Mae, this announcement doesn’t help you much.

Bottom line: we think that Congress should act to ensure that every American gets their reliable credit scores from the three major credit bureaus, for free, when they submit a request for their free annual credit reports. As we point out in our recent policy brief on credit reporting, consumers are increasingly frustrated that they can’t get a straight answer about their true credit scores – not to mention that they keep finding errors on their credit reports that impact their scores and are hard to fix.

Consumers Union strongly endorses the Stop Errors in Credit Use and Reporting (SECURE) Act, introduced in Congress in April by Senators Schatz and Brown, which would provide consumers with their free annual credit scores when they ask for their free credit reports at annualcreditreport.com. The bill also would require the CFPB to create rules to improve the accuracy of the credit bureaus. We won’t be able to get it passed without you. Please show your support by sharing your credit score and reporting story with us!

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