By Kathy Chu, USA TODAY
At a time when it's more important than ever for consumers to monitor their credit scores, they're losing one option of doing so. Starting Saturday, FICO credit scores based on data from Experian, one of the three major credit bureaus, will not be available to consumers.
Steven Wagner, president of consumer information services at Experian, says the firm nixed its partnership with Fair Isaac to sell the scores to consumers because Fair Isaac was "simply unreasonable" in negotiating a separate contract.
The development is troubling to some experts because FICO credit scores are widely used - from lenders granting loans to employers making hiring decisions.
"You now have access to 33% less important information you should have access to," says John Ulzheimer, president of consumer education at Credit.com, an educational site. "If you've been declined a loan because of your Experian (FICO) credit score, good luck, because you can't get it."
Tom Quinn, a vice president at Fair Isaac, says the FICO score is used by about 90% of the country's 100 largest financial institutions.
"We were surprised," Quinn says, "that at this time of economic uncertainty, Experian would choose to terminate this contract and deny consumers the ability to get their score."
The two other major credit bureaus - TransUnion and Equifax - will continue to partner with Fair Isaac to sell credit scores to consumers. Other credit scores, including the VantageScore, which all three bureaus developed together, will remain available. Experian continues to sell consumers' FICO credit scores to lenders.
In today's economy, it's important that consumers stay on top of their credit scores, because lenders will be doing so, says Ulzheimer, a veteran of Fair Isaac and Equifax.
As families' financial situations deteriorate, lenders are protecting themselves from losses by requiring higher credit scores to qualify for new loans. Lenders are also reducing their risk on existing loans such as credit cards by lowering limits and closing inactive accounts, affecting consumers' credit scores.
Experian's Wagner says consumers still will have access to the important information - such as payment record and credit history - that underlies their credit scores. Also, consumers who apply for mortgages will still be able to get all three versions of their FICO score through lenders, according to Experian.