Wow – this is a crisis. As reported in the Wall Street Journal on January 23, 2020, FICO announced its newest software version used by its financial institution customers will change the rating mix. The changes will be designed to lower scores on consumers that have high debt levels and miss payments. The shift reflects a new direction for FICO – which under Fico 9.0 (its latest version) had eased the “ding” to consumers on settled debts and removed the reporting of civil judgments. The reason for the shift is that the Credit Card Companies see problems on the horizon. A couple of quotes from the article tell the story of what is going on:

The new FICO changes reflect a shift in U.S. lenders’ confidence in the economy, which has been expanding for more than 10 years. Consumer loan losses remain low compared with during the last recession, but consumer debts are at record highs, with many Americans forced to rely on debt to help fund their everyday lives.

There are some lenders that see there are problems on the horizon in terms of consumer performance or uncertainty [about] how long this [recovery] is going to go,” said David Shellenberger, vice president of scores and predictive analytics at FICO. “We definitely are finding pockets of greater risk.

On an earnings call last year, Capital One Financial Corp. Chief Executive Richard Fairbank warned that consumers across the industry might not be as creditworthy as their scores suggest.

So – should you panic? Is the possibility that your credit score goes down a crisis? The answer is no – this is not a crisis. There is a potential crisis here, but you have to see the light at the end of the tunnel. If you are one of the persons whose credit score may go down because you are late on payments and have too much debt – this is the crisis – not your credit score! If you are carrying excessive credit card debt, you are making minimum payments and paying high interest which puts you in the credit card trap and means you are wasting your financial future.

The financial world doesn’t want you to know this, but your credit score is not what you should worry about. You need to focus on eliminating debt and not paying interest. The banks simply want to scare you into continuing to pay the high interest and carrying levels of debt that make them rich and you forever poor. They do this by making your credit score the talk of the town! Now don’t get me wrong – there is nothing wrong with a high credit score and making all your payments timely. The point is – it is easy if you don’t carry the debt. The problem is the debt and the fix is not stressing over making every payment on time the rest of your life to protect your credit score – at a cost of paying thousands and thousands of dollars in interest. The fix is getting rid of the debt.

Here is the important news! On Wednesday, February 26th – at 6:00 PM, we are holding a FREE SEMINAR, “Bye Bye, Credit Card Debt – Hello, Happiness!” This is your opportunity to get ahead of the game and stop wasting your financial future by paying interest – every month, month after month, year after year. Learn there is a better way and join us – and say hello to Happiness! Details are below.

Have a great week,


Did you know that THAV GROSS offers free consultations for business, financial, and tax problems? Call us anytime – (248) 645 – 1700 or CLICK HERE to send us a message.