Boost and Ultra: Credit Scoring’s new superheroes?
Is your credit score in so much peril that it might as well be stick on a crumbling bridge, falling off the tallest skyscraper, or even battling an intergalactic super villain?
While your three-digit credit score probably isn’t THAT bad, it might feel like it as you try to pay down debt, apply for a mortgage, or just about anything else to navigate your finances.
But now, every damsel (and dude) in credit distress has not one but two superheroes ready to swoop in and save them. (Or, at least save their credit score.)
Here come BOOST and ULTRA!
But if you’re looking into the sky for two superheroes flying in capes and colorful tights, you may be disappointed, because Boost and Ultra are actually helpful tools recently rolled out by Experian and Fico, respectively.
Today, let’s look at ExperianBoost and UltraFico and see if they can make tall-building-sized leaps with your credit score.
Credit scoring mutants?
ExperianBoost and UltraFico both were instituted to work within the current credit scoring models, rewarding consumers who manage their finances correctly and exhibit good money habits. They also both work to help people with limited credit or no (called Credit Invisible) or those who need some serious credit score rehabilitation.
In fact, ExperianBoost and UltraFico are most likely to assist consumers with scores in the 500s and low 600s, according to two credit scoring companies.
A super transformation:
Maybe you haven’t been bitten by a radioactive spider, but your credit score can still transform to superhuman proportions. Experian reports that nearly two-thirds of consumers who have signed up for Boost have seen a score increase, with the average increase of 13 points. That’s a pretty remarkable jump in a short time just for adding your banking information!
When they’ll swoop in:
ExperianBoost launched in March of 2019 and is already available for consumers via Experian’s website.
UltraFICO is being released this summer in a partial version (think of Robin showing up, not Batman). But the larger or full release will come this fall according to FICO.
Right now, both tools are being Beta tested by a select group of financial institutions, including credit card startup, Deserve and the PenFed Credit Union.
While Boost and UltraFico will surely help a good number of consumers with marginal credit scores and “light” credit jackets, there are some finer points and limitations to understand before we think that they’ll save the world.
Boost is a free service released by Experian with the sole function of increasing the score for certain consumers.
To take advantage of it, you just need to sign up for Boost on Experian’s website. It will ask you to input your bank account information, connecting that financial institution with Experian.
After that, Experian will be able to scan your banking transactions for items like cell phone payments and utility bill payments that are made on time every month.
Once they find those on your banking records, they add them to your Experian credit report, so they can act as positive factors in Experian’s scoring algorithm and improve your score.
But what if you have several utility accounts in good standing, but you’ve missed several payments with your cell phone, for instance? The good news is that you can pick and choose which bills to add to your Experian report through Boost. Whew, that was a close call!
Once you sign up, you can see Boost in action as it lifts your FICO overhead, as Experian gives you free access to your FICO score so you can see your score rise.
According to Experian, Boost will improve scores for FICO 8, FICO 9, VantageScore 3, and VantageScore 4, which are commonly used scores by lenders.
However, the score increase you may see through Boost will only show up when a lender will access your Experian credit report with those versions. If a lender pulls other versions of your credit or uses scores from TransUnion or Equifax, the improvement will not be reflected.
FICO is the most common form of credit scores, used by millions of lenders daily as they make lending decisions. The newest, supercharged version of FICO – ULTRA – is free for consumers to use, but they do need to opt in.
That’s easy to do; just go to the FICO website and enter your bank account information, linking your accounts to FICO’s system. From there, FICO will scan your transactions for several items. Those include your typical bank balances (or how many times you’ve overdrawn your account), how long your accounts have been open, and how active your account is.
The best way to use UltraFico is when you’re applying for a loan or credit card. Simply ask them if they use UltraFico or, if you’re initially denied, ask them to check your UltraFico – the potential score increase may just help you get approved, but it will still only count as one credit check.
Unfortunately, Ultra FICO’s superpowers are somewhat invisible since you can’t easily log in to check your FICO score and see the increase. In fact, the only time you can see if Ultra FICO is working is if you’re turned down a second time when applying for credit, receiving a letter in the mail explaining why. But there is also talk of a way to access your FICO score more easily coming by the end of the year.
Does your credit score need some super saving?
Are UltraFico or Boost tools that can help you? If your bank account is stable and your transactions show that you’re paying your utilities and cell phone on time every month, and you need a credit score increase to get applied for a new loan, Boost or Ultra FICO may help you.
But there are some concerns, as you need to share your personal bank account information (not a step to take lightly considering data hacks these days) and both will only help with Experian.
All good information to consider! If you have any questions about Boost, Ultra, or anything related to improving your credit score, just contact us at Blue Water Credit!