You recall the time when you checked your credit score frequently and adjusted your behavior to improve or preserve that three-digit figure. But one day you ran your latest credit report and realized that your FICO score, which is a score given to you by the Fair Isaac Corporation and which ranges between 300 to 850 was missing. Well, what do you think happened to your score to make it disappear into thin air as it were?
The following are some of the reasons you may lose your FICO credit score, especially when you used to have one for years. Finding out why you do not have access to a FICO score any longer will assist you in the process of reestablishing credit so that a score can be created again at a later date.
This is because the lender has no credit history, meaning that there are no records of payments that can be used to determine whether or not the borrower is trustworthy enough to pay back the loan that was granted.
The first and most obvious explanation for why your FICO score has gone missing is that you do not have any credit history. Every credit card, personal loan, mortgage, and other similar types of accounts you borrow are reported to the three major credit bureaus: Experian, TransUnion, and Equifax. Such bureaus aggregate this information to prepare credit reports.
FICO credit score is derived from the information held in the three credit reference agencies. If all data were deleted from credit reports and you do not have any open credits, no balances, late payments – nothing – then there will be nothing to calculate the score.
This situation may occur if all credit accounts were recently closed or if previous errors required requesting deletion information. It could also happen after some significant life change like bankruptcy for instance. After bankruptcy, the credit reports can be blank after the bankruptcy with no other credit information available.
In other words, many of the people in your target market likely have thin credit files.
Another scenario is you now are thin-file consumers with possibly one or two new credit accounts opened. For instance, if you have opened a new credit card recently and have an auto loan that is also recent and less than six months old, then there is very little data that can be used to assess risk and come up with a score. In this respect, scores are cumulative of many factors towards a given period and not at a one-point period. In such thin file situations, more data points are required to assign credit scores. To obtain an automated score there must be a specified amount of recent and diverse credit account data.
You are a victim of fraud or errors
Lack of FICO score may also mean that you were a victim of identity theft or other severe credit reporting mistakes. If someone misused your identity for fraud, then he/she could have opened fake accounts or provided wrong payment details. The credit bureaus might have removed all the information that could be deemed to be compromised due to this activity once you showed them it was fraudulent while they carried out their investigations. This would entail the fact that there would be no accounts or balances to support the score in a way that could be verified.
In the same way, if you challenged certain big mistakes on your reports such as accounts that were not yours or payments that were reported as late when in fact they were not - and you can substantiate it with the credit bureaus – then they could have deleted the disputed items given the fact that they were wrong. I believe that large-scale removals resulting from errors being corrected may have removed most or all the accurate data required for scoring.
No FICO Score With Only Authorized User Accounts
Another thing that you should remember is that the FICO scores do not include authorized user accounts that rely on another person’s credit history. For instance, if your spouse authorized you to be on their credit card account, an account that they have been using for fifteen years, it means being an authorized user does not mean the fifteen years will be computed into your credit score. FICO only includes those loans and credit cards upon which you alone are responsible for repayment. AU status does not mean that the consumer is responsible for making the payment or is held legally responsible for the debt.
Further Actions to Reestablish Credit and Regain FICO Score
If you realize that you have no working current FICO score, start with checking your official credit reports at AnnualCreditReport. com to understand why you can no longer obtain a score. In the end, recall the personal information tab and the account information tab. This means that one should search for any fraud alerts or other statements regarding investigations, compromised identity situations, or extensive changes made. Also, verify that there are no open accounts that should still be displayed.
In the future, you will need to reconstruct credit in your name that has no authorized user workarounds; and you can only create at least six months of positive payment history to enable FICO scoring models to compute your credit rating. Do not attempt to open too many new cards or loans at a time as this may take time to process. Only go for what you can be reasonably entitled to and can handle at this stage. By paying your bills on time and using new credit lines wisely, you should be able to have access to your FICO score again.
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