Potentially Good News for Your Credit Score! FICO Creating New UltraFICO Score Based on Checking History
Signing up for credit cards through partner links earns us a commission. Terms apply to the offers listed on this page. Here’s our full Advertising Policy.
According to the Wall Street Journal, FICO is planning to release a new scoring model, the “UltraFICO.”
The UltraFICO score will factor in things like your checking balance, checking transaction history, and overdraft history. Whereas your FICO score is only based on your credit history including factors like payment history, new credit inquiries, debt, and length of credit history.
With this change, you’ll still have a traditional FICO score, but you’ll also have a second UltraFICO score. And for a lot of folks, their UltraFICO score should be higher, which could help you get approved for more of the great travel rewards cards out there. 😉
For millions of people, this means there’s likely to be an increase in your score when comparing your old FICO score to your UltraFICO score. Because most folks have a long checking history even if they don’t have a long credit history. However, banks won’t be required to use your UltraFICO score when approving you for loans or credit.
That said, changes like this could also lead to more issues for creditors because it could lead to more people having inflated credit scores. If creditors start lending to those who can’t handle credit responsibly it could cause an increase in payment defaults and possibly more restrictions in the future.
What’s your take on this news? Do you think it will have a positive effect on consumers as a whole? Share your thoughts in the comments!
Hat Tip: Wall Street Journal
Chase Sapphire Preferred® CardAPPLY NOW
Chase Sapphire Preferred® Card
Earn 60,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That’s $750 toward travel when you redeem through Chase Ultimate Rewards®
2X points on travel and dining at restaurants worldwide, eligible delivery services, takeout and dining out & 1 point per dollar spent on all other purchases.
Get 25% more value when you redeem for travel through Chase Ultimate Rewards®. For example, 60,000 points are worth $750 toward travel.
Get unlimited deliveries with a $0 delivery fee and reduced service fees on orders over $12 for a minimum of one year on qualifying food purchases with DashPass, DoorDash’s subscription service. Activate by 12/31/21.
Earn 2x total points on up to $1,000 in grocery store purchases per month from November 1, 2020 to April 30, 2021. Includes eligible pick-up and delivery services.
Either $5 or 5% of the amount of each transfer, whichever is greater.
Editorial Note: We're the Million Mile Secrets team. And we're proud of our content, opinions and analysis, and of our reader's comments. These haven’t been reviewed, approved or endorsed by any of the airlines, hotels, or credit card issuers which we often write about. And that’s just how we like it! :)