FICO Scores and Dating - All Wrong

[DualIncomeNoDebt]

The NYT has a Christmas Day article about dating and FICO scores. http://goo.gl/uEUN0 An excerpt:

It's so widely used that it has also become a bigger factor in dating decisions, sometimes eclipsing more traditional priorities like a good job, shared interests and physical chemistry. That’s according to interviews with more than 50 daters across the country, all under the age of 40.

"Credit scores are like the dating equivalent of a sexually transmitted disease test," said Manisha Thakor, the founder and chief executive of MoneyZen Wealth Management, a financial advisory firm. "It's a shorthand way to get a sense of someone's financial past the same way an S.T.D. test gives some information about a person's sexual past."

This article makes me want to bang my head against a wall. Financial issues should be an important topic among potential partners, perhaps one of the top ones. But those who think FICO is important are going about it wrong. All wrong.

Maybe I'll explain my thinking on this after I see what others think, but suffice to say, I couldn't give a damn about my FICO, have no idea what it is. So you think that makes me a bad financial risk or financially irresponsible? Silly grasshopper.

[Bungo]

FICO = past performance. No guarantor of future returns.

My officemate is active on the dating scene. I'm sure he had a great FICO score until he stopped paying his mortgage earlier this year.

[interplanetjanet]

The NYT has a Christmas Day article about dating and FICO scores. http://goo.gl/uEUN0 An excerpt:

It's so widely used that it has also become a bigger factor in dating decisions, sometimes eclipsing more traditional priorities like a good job, shared interests and physical chemistry. That’s according to interviews with more than 50 daters across the country, all under the age of 40.

"Credit scores are like the dating equivalent of a sexually transmitted disease test," said Manisha Thakor, the founder and chief executive of MoneyZen Wealth Management, a financial advisory firm. "It's a shorthand way to get a sense of someone's financial past the same way an S.T.D. test gives some information about a person's sexual past."

This article makes me want to bang my head against a wall. Financial issues should be an important topic among potential partners, perhaps one of the top ones. But those who think FICO is important are going about it wrong. All wrong.

Thinking that FICO is important is not the same as equating higher scores linearly with lower risk.

I don't think it would matter much to me if a partner of mine had a score of 650 instead of 800 - or even if they had no score at all and had not availed themselves of credit. If they had a FICO of 450 and finding that out was a surprise to me then yes, I'd call that an important piece of information and would consider that to be at least somewhat a predictor of their attitudes towards financial responsibility.

[nisiprius]

I think the credit bureaus have done a stunningly effective job of being given a lemon (required disclosure) and making lemonade. I find it deeply disturbing that information acquired for one purpose--extending credit--is now widely used and accepted as a proxy for integrity, honest, morality, "character," etc. This is very bad but I have no idea what to do about it. We live in a world where standardized tests are now deemed to grade our worth as human beings.

To those who say "it's legitimate, because there are correlations between credit scores and X" I say "Yeah, and I'll bet there are also correlations between income and X, social class and X, skin tone and X."

[The Wizard]

Financial stability and responsibility are what's important.
I usually score an A in those depts, but I did get dinged on my FICO score a few yrs back due to late payments on edu loans I co-signed with an irresponsible offspring.
Oh well, stuff happens, and I'm not really in the dating scene anymore either...

And, correct me if I'm wrong, but I think you may get extra points on your FICO score if you keep a modest balance on a credit card and just make the minimum payment each month, which clearly is a really STUPID way of mis-managing your finances...

[sscritic]

I think the credit bureaus have done a stunningly effective job of being given a lemon (required disclosure) and making lemonade. I find it deeply disturbing that information acquired for one purpose--extending credit--is now widely used and accepted as a proxy for integrity, honest, morality, "character," etc. This is very bad but I have no idea what to do about it.

Agreed. Don't ask about FICO, ask for the last three years of tax returns, bank statements, credit card bills, and credit reports. Using a summary is a lazy shortcut to what you really want to know.

[SimonJester]

If you had $200 million in cash and investments, one could say you were doing quite well financially, however if you didn't barrow money or use credit cards you would have a very low FICO score.

FICO is not an indication of financial success, it is an indication of how often and how well you barrow money.

[bungalow10]

A healthy FICO does not mean someone is drowning in debt, it means they pay their bills on time and there is a perceived capacity to take on more debt.

It's not perfect, but I would definitely prefer a mate with a high FICO than one with a crappy FICO. A crappy FICO is an indicator of some type of problem, and it could be one-time or habitual, but either way, as a potential partner, I would want to know about it.

Sure a zero FICO is ideal, but that is an outlier. No one in the article said the FICO score was the only financial discussion that was to take place.

[mwm158]

Some FICO estimator put me at 755-805. Come and get me girls!

[VictoriaF]

Don't ask about FICO, ask for the last three years of tax returns, bank statements, credit card bills, and credit reports. Using a summary is a lazy shortcut to what you really want to know.

Some FICO estimator put me at 755-805. Come and get me girls!

Please post the information listed by sscritic.

Victoria

[Cherokee8215]

Not that I'm in a position to be this choosy, but I wouldn't be interested in being in a relationship with someone who has an awful credit score. It could be an indicator of poor decision-making, lack of responsibility, not being very employable, etc. Of course, one might want to know more about what led to that low score, but the score itself is an easy initial indicator of a problem. Poor decision-making and a lack of responsibility are qualities that I certainly do NOT want in a partner.

[porcupine]

The NYT has a Christmas Day article about dating and FICO scores. http://goo.gl/uEUN0 An excerpt:

It's so widely used that it has also become a bigger factor in dating decisions, sometimes eclipsing more traditional priorities like a good job, shared interests and physical chemistry. That’s according to interviews with more than 50 daters across the country, all under the age of 40.

"Credit scores are like the dating equivalent of a sexually transmitted disease test," said Manisha Thakor, the founder and chief executive of MoneyZen Wealth Management, a financial advisory firm. "It's a shorthand way to get a sense of someone's financial past the same way an S.T.D. test gives some information about a person's sexual past."

This article makes me want to bang my head against a wall. Financial issues should be an important topic among potential partners, perhaps one of the top ones. But those who think FICO is important are going about it wrong. All wrong.

Maybe I'll explain my thinking on this after I see what others think, but suffice to say, I couldn't give a damn about my FICO, have no idea what it is. So you think that makes me a bad financial risk or financially irresponsible? Silly grasshopper.

I'm with you. I've been thinking for over a year that I should create a "Porcupine Score" that would be more reflective of someone's financial wellbeing than the FICO is; Dave Ramsey was recommending a different number a few months ago as well (I fail to recollect which one that was). But everything currently in the market is flawed.

The FICO represents the lendablility (if such a word were to exist) of an individual, not his/her financial wellbeing. So, if I were to wish to lend to someone, sure, the FICO would be at the top of my list of litmus tests. But dating and/or marrying? Notwithstanding the fact that I am already married , it would not make it to my personal list of ways to assess the financial wellbeing of a potential spouse.

I do see where a lazy individual could use it as a proxy, but I wouldn't really have extra hopes of the finances working out in a marriage that used the FICO as the cornerstone for financial compatibility of the couple.

- Porcupine

[greg24]

While FICO is imperfect and is measuring something different than what many people use it for, it is an excellent proxy of financial health. Sure, there are outliers, but generally someone with an 800 is financially healthy, while a 600 has some financial difficulties.

But like everything else with dating, you learn some general things on the first date and really get to know someone the longer you date them.

[jridger2011]

It seems unfair to judge someone based on that knowing how badly a credit score can drop from things like medical bills and co-signing of loans for family members like offspring. However, it's important to know that someone you could potentially be with for long term is not deeply in debt and some of the life goals together will be on hold while those debts are settled and they aren't increasing their debts without your knowledge. Even with warning signs in place, I think most people will ignore credit scores and proceed with their hearts.

[Default User BR]

And, correct me if I'm wrong, but I think you may get extra points on your FICO score if you keep a modest balance on a credit card and just make the minimum payment each month, which clearly is a really STUPID way of mis-managing your finances...

I've never seen anything about that. In fact, it would hurt your score as your debt to credit ration would be worse.


Brian

[The Wizard]

While FICO is imperfect and is measuring something different than what many people use it for, it is an excellent proxy of financial health...

I disagree.
It tells me next to nothing about whether your primary residence is paid off or how many times your annual income you have in investments.
It tends to be a one-dimensional score of how well you handle CREDIT...

[VictoriaF]

While FICO is imperfect and is measuring something different than what many people use it for, it is an excellent proxy of financial health...

I disagree.
It tells me next to nothing about whether your primary residence is paid off or how many times your annual income you have in investments.
It tends to be a one-dimensional score of how well you handle CREDIT...

FICO is a convenience to reject; it's not a good criterion to accept. It's like GPA. If you have lots of applicants and want to narrow your selection pool, you discard those with low scores. There will be some false positives, but the process is efficient. Geniuses and great lovers with low scores should not try to make it in a crowd.

Victoria

[donall]

This was a funny article. Hopefully there are not too many individuals out there who will let FICO rule their love life.

[porcupine]

And, correct me if I'm wrong, but I think you may get extra points on your FICO score if you keep a modest balance on a credit card and just make the minimum payment each month, which clearly is a really STUPID way of mis-managing your finances...

I've never seen anything about that. In fact, it would hurt your score as your debt to credit ration would be worse.


Brian

Brian:

I disagree. I could be wrong, but my understanding is that the debt to credit ratio is a snapshot of when the credit report/score was generated. In other words, if I pay my balance every month (i.e., pay $0 in interest) and have a recent balance of $4000 on my credit cards, and all else is equal, my credit score will be lower than someone else who pays the minimum each month (i.e., pays a recurring amount in interest), has the same amount of available credit, but has a recent balance of $3000 on his/her credit cards.

- Porcupine

[greg24]

While FICO is imperfect and is measuring something different than what many people use it for, it is an excellent proxy of financial health...

I disagree.
It tells me next to nothing about whether your primary residence is paid off or how many times your annual income you have in investments.
It tends to be a one-dimensional score of how well you handle CREDIT...

Start a study. Create a population of individuals and check whatever you feel are signs of financial health (net worth, debt, salary, etc.). Take the results of this study and compare them to their credit scores. I would wager that the correlation is very very high.

[The Wizard]

Take Made Men for example. They deal in cash for everything, no credit history at all in most cases.
So a FICO score would be useless with that cohort...

[rr2]

And, correct me if I'm wrong, but I think you may get extra points on your FICO score if you keep a modest balance on a credit card and just make the minimum payment each month, which clearly is a really STUPID way of mis-managing your finances...

I've never seen anything about that. In fact, it would hurt your score as your debt to credit ration would be worse.


Brian

Brian:

I disagree. I could be wrong, but my understanding is that the debt to credit ratio is a snapshot of when the credit report/score was generated. In other words, if I pay my balance every month (i.e., pay $0 in interest) and have a recent balance of $4000 on my credit cards, and all else is equal, my credit score will be lower than someone else who pays the minimum each month (i.e., pays a recurring amount in interest), has the same amount of available credit, but has a recent balance of $3000 on his/her credit cards.

- Porcupine

Porcupine -- I am pretty sure that FICO scores do not work this way. The thing that matters is the ratio of the balance that is reported usually on statement closing date to the available credit limit. This is independent of whether you pay it in full. FICO scores do not care about the interest directly.

[porcupine]

And, correct me if I'm wrong, but I think you may get extra points on your FICO score if you keep a modest balance on a credit card and just make the minimum payment each month, which clearly is a really STUPID way of mis-managing your finances...

I've never seen anything about that. In fact, it would hurt your score as your debt to credit ration would be worse.


Brian

Brian:

I disagree. I could be wrong, but my understanding is that the debt to credit ratio is a snapshot of when the credit report/score was generated. In other words, if I pay my balance every month (i.e., pay $0 in interest) and have a recent balance of $4000 on my credit cards, and all else is equal, my credit score will be lower than someone else who pays the minimum each month (i.e., pays a recurring amount in interest), has the same amount of available credit, but has a recent balance of $3000 on his/her credit cards.

- Porcupine

Porcupine -- I am pretty sure that FICO scores do not work this way. The thing that matters is the ratio of the balance that is reported usually on statement closing date to the available credit limit. This is independent of whether you pay it in full. FICO scores do not care about the interest directly.

From what you wrote, we are on the same page.

- Porcupine

[JArthur]

If there were no FICO scores what would banks use to determine credit worthiness? Probably much the same information which is in the FICO score.

I don’t have a problem with this as it isn’t the whole picture of someone, but merely a piece of the puzzle that can be a red flag, like if they have insane in-laws, or extraordinarily high number of previous partners, etc.

[rr2]

And, correct me if I'm wrong, but I think you may get extra points on your FICO score if you keep a modest balance on a credit card and just make the minimum payment each month, which clearly is a really STUPID way of mis-managing your finances...

I've never seen anything about that. In fact, it would hurt your score as your debt to credit ration would be worse.


Brian

Brian:

I disagree. I could be wrong, but my understanding is that the debt to credit ratio is a snapshot of when the credit report/score was generated. In other words, if I pay my balance every month (i.e., pay $0 in interest) and have a recent balance of $4000 on my credit cards, and all else is equal, my credit score will be lower than someone else who pays the minimum each month (i.e., pays a recurring amount in interest), has the same amount of available credit, but has a recent balance of $3000 on his/her credit cards.

- Porcupine

Porcupine -- I am pretty sure that FICO scores do not work this way. The thing that matters is the ratio of the balance that is reported usually on statement closing date to the available credit limit. This is independent of whether you pay it in full. FICO scores do not care about the interest directly.

From what you wrote, we are on the same page.

- Porcupine

I suppose it wasn't clear but what I mean is that the $4000 balance will be reported to the credit bureau irrespective of whether you paid it in full. The only way for it to not report would be if you paid the balance before the statement closing date.

[porcupine]

[...]
Porcupine -- I am pretty sure that FICO scores do not work this way. The thing that matters is the ratio of the balance that is reported usually on statement closing date to the available credit limit. This is independent of whether you pay it in full. FICO scores do not care about the interest directly.

From what you wrote, we are on the same page.

- Porcupine

I suppose it wasn't clear but what I mean is that the $4000 balance will be reported to the credit bureau irrespective of whether you paid it in full. The only way for it to not report would be if you paid the balance before the statement closing date.

Well, that is exactly what I meant as well. My point was that 4,000/100,000 (or whatever) would be a worse credit utilization ratio - and would appear worse on a FICO calculation - than a 3,000/100,000, even though the latter was the one that was actually paying more interest (and should really have a lower anything-but-FICO score).

- Porcupine

[Epsilon Delta]

FICO is a convenience to reject; it's not a good criterion to accept. It's like GPA. If you have lots of applicants and want to narrow your selection pool, you discard those with low scores.

Victoria

In this case the pool of applicants is close to the size of the pool of positions. And the applicants are also evaluating you. Under those circumstances any heuristic that differs from your genuine selection criteria will result in a poorer match than if you use your real criteria. You do not want to reject candidates for reasons you care little about. This is true even if you are highly desirable and have a deep pool of candidates.

[The Wizard]

FICO is a convenience to reject; it's not a good criterion to accept. It's like GPA. If you have lots of applicants and want to narrow your selection pool, you discard those with low scores.

Victoria

In this case the pool of applicants is close to the size of the pool of positions. And the applicants are also evaluating you. Under those circumstances any heuristic that differs from your genuine selection criteria will result in a poorer match than if you use your real criteria. You do not want to reject candidates for reasons you care little about. This is true even if you are highly desirable and have a deep pool of candidates.

This is why there are multiple flavors of FICO scores.
http://bucks.blogs.nytimes.com/2012/08/ ... co-scores/
Your car loan score differs from your home mortgage score...

[chicagobear]

I don't have any debt (but did years ago) so what would my FICO score be?

[The Wizard]

I don't have any debt (but did years ago) so what would my FICO score be?

No credit card usage even?
In that case you have Thin Credit.
They probably assign you a neutral FICO score indicating uncertainty on how you might handle a $10,000 loan...

[chicagobear]

I don't have any debt (but did years ago) so what would my FICO score be?

No credit card usage even?
In that case you have Thin Credit.
They probably assign you a neutral FICO score indicating uncertainty on how you might handle a $10,000 loan...

Credit card that is paid off each month. I rent. Paid off previous student loan and car loans years ago.

[The Wizard]

I don't have any debt (but did years ago) so what would my FICO score be?

No credit card usage even?
In that case you have Thin Credit.
They probably assign you a neutral FICO score indicating uncertainty on how you might handle a $10,000 loan...

Credit card that is paid off each month. I rent. Paid off previous student loan and car loans years ago.

Credit card usage is short-term debt at least and your record of payments on this will be what they look at.

[kiligi]

I didn't really understand the point of the article, in large part because it pre-supposes honesty of those that FICO has already deemed "non-trustworthy" via their scores. Why would anyone voluntarily disclose a negative about themselves that cannot easily be checked by the questioner?

You are out on a first or second date. Your date asks you about your FICO score. What prevents you from saying, "It's excellent.", even if that isn't the truth? Nothing. And if the person does have a bad score, wouldn't you expect someone with a bad score (supposedly less trustworthy) to give you a less truthful answer? So, shouldn't you expect that those who say that their score is excellent to actually be the people you want to avoid? You know, those who have an incentive to be less than truthful.

It would seem like those who actually gave you a bad score are the ones who would be showing themselves to be honest, and worth getting to know better. Or, maybe people with high scores would understate their scores in order to make sure that their dates weren't gold diggers only interested in what they could buy/borrow. But if they are understating their FICO scores, maybe they are showing themselves to be the people who you want to avoid because they would rather lie to a date to make sure they avoid gold digging rather than prizing honesty.

Quite frankly, this topic seems more like the modern version of "So, I clearly cannot choose the wine in front of you!"* issue rather than anything approximately a decent way to narrow down people desirable to date. And I have a hard time believing that many people have such a multitude of options in dating where FICO scores would start to make sense as a weeding tool. But it is an article that made people discuss the topic at the virtual watercooler, so bravo NY Times for selling page views and being a good advertiser for itself.

* Bonus points for those who can place said quote in movie context.

[rr2]

[...]
Porcupine -- I am pretty sure that FICO scores do not work this way. The thing that matters is the ratio of the balance that is reported usually on statement closing date to the available credit limit. This is independent of whether you pay it in full. FICO scores do not care about the interest directly.

From what you wrote, we are on the same page.

- Porcupine

I suppose it wasn't clear but what I mean is that the $4000 balance will be reported to the credit bureau irrespective of whether you paid it in full. The only way for it to not report would be if you paid the balance before the statement closing date.

Well, that is exactly what I meant as well. My point was that 4,000/100,000 (or whatever) would be a worse credit utilization ratio - and would appear worse on a FICO calculation - than a 3,000/100,000, even though the latter was the one that was actually paying more interest (and should really have a lower anything-but-FICO score).

- Porcupine

Understood. We are in agreement.

[gwrvmd]

Economics is the last legal method of discrimination/segration. You see it quite clearly in residential zoning ordinances and it the residential housing market
FICO is a good screening method; I don't doubt it will become more prevalent in the dating/matchmaking arena. For those who resist it; that in and of itself is a warning

[greg24]

Take Made Men for example. They deal in cash for everything, no credit history at all in most cases.
So a FICO score would be useless with that cohort...

Thats what your hangup is? What percentage of the population is Made Men? 0.000000000001%?

Just avoid mafiadating.com.

[greg24]

Inconceivable.

[VictoriaF]

Or, maybe people with high scores would understate their scores in order to make sure that their dates weren't gold diggers only interested in what they could buy/borrow. But if they are understating their FICO scores, maybe they are showing themselves to be the people who you want to avoid because they would rather lie to a date to make sure they avoid gold digging rather than prizing honesty.

This is possible but not very probable. It's like a guy with a Porsche picking up his date in Honda Civic.

Victoria

[Alex Frakt]

Locked. This is a general comment thread. Issues here must be directly personal. So if you want to ask if you should date a real person with a real FICO score - high or low - go ahead. But this is OT.