If you thought credit scores were only used to help lenders decide whether or not they should extend credit – think again! Sure, you may know that there are employers who run a credit check before they hire; and that your car insurance premium is partly based on your credit score… but did you think your internet browsing would be affected by your FICO?

Google has started to experiment with their Google ads by showing more expensive products and services to individuals with higher FICO scores. Google has always been known for their pay per click advertising and the ability for advertisers to target specific markets – but is this taking it a step too far?

Right now, there is a database of about 2 million people through “Compete”, who agreed to share their credit score when applying for a new credit card. These people are then targeted with specific Google ads when they use their computer, based on what their credit scores are. This allows advertisers to reach consumers who qualify for their products – for example, advertisers trying to sell mortgages to people with FICO scores over 700 would only show their ads to this group of internet users. Primarily, this data will be used to target users seeking credit cards, but any company interested in displaying ads to a group of people with a specific credit score would be able to do so.

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Tags: Credit Card News by David
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Wed 1 Jul 2009 Posted by Basti under Family Finance, Money and Business, Loans, creditNo Comments Are you currently struggling financially due to your credit card debt, and having a hard time coping because of the high interest rates?

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Tags: Debt Consolidation by David
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For months, people have been complaining that their credit limits have been reduced, and wondering what the long term implications of that would be. Turns out – just as predicted, the FICO scoring model is not quite holding up to the changes in the credit card industry. As credit limits are reduced by banks (and not always at the fault of the cardholder), the debt utilization percentage increases for individuals and suddenly they wind up with lower credit scores.

 One woman in Oregon complained to JPMorgan Chase & Co when they reduced her credit limit that it would hurt her 760 credit score. She claims the company said that wasn’t their problem – it was FICO’s problem to deal with. When her credit limit was reduced from $42,500 to $12,000, her debt in relation to the amount of available funds she had quadrupled. Since the debt utilization percentage is a large factor in how the FICO formula calculates someone’s credit score – she is concerned her lower score will cause problems if she should want credit in the future.

Approximately 30 million Americans have had credit limits reduced during the second half of 2008, according to estimates from FICO. 

The biggest problem with this situation is that when banks reduce a consumer’s credit line based on the overall economy, it is not an accurate indication of whether or not that person is a higher risk for creditors to lend to. So when their FICO score is reduced, they’re labeled as higher risk for credit – increasing the interest rates they pay and making it harder to obtain credit.

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Buried in the new law that regulates credit card companies are a couple of rules, called for by President Obama in a town hall meeting in Rio Rancho, New Mexico, “to protect students from getting stuck in debt before they even get …

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It’s that time of year, when we’re sending our high school and college graduates off into the next phase of their lives with best wishes for a happy, successful future. But there’s a serious threat to that secure future, …

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