Dear Liz: I began paying down my debt six months ago and have paid off $10,000 so far. I subscribed to a credit score tracking system through a free offer and was told my credit score was in the 670 range most of the time. When I applied for a mortgage loan recently, however, the bank told me my middle score was only 612. One credit bureau said my score was just 590! How is this possible?

Answer: There are many different credit scoring formulas available today, but the one used by most mortgage lenders is the FICO. You have FICO scores from each of the three bureaus, and mortgage lenders typically use the middle of those three scores to determine your rates and terms.

Unfortunately, many of the companies hawking “alternative” scores don’t make it clear to their customers that they’re not seeing a FICO score. The confusion is compounded by the fact that your credit scores, including your FICOs, change all the time, and lenders also use somewhat different versions of the FICO scoring formula, which can produce somewhat different results.

Still, for a score that’s closest to what your lender will see and use, you want FICOs. You can buy your FICO scores for two of the three bureaus at Unfortunately, Experian no longer sells FICO scores to consumers, although it continues to sell them to lenders. That means you can no longer know in advance what rate you qualify for, since you can’t know what your middle score is until your lender gets all three.

Dear Liz: I’m 59 and unemployed. My husband, who is turning 65 in July, recently lost his job as well. We’ve saved about $12,000 for emergencies and have a couple of 401(k) accounts totaling about $110,000. My husband receives about $1,800 a month from Social Security and a pension. We’re not too hopeful about finding jobs at our ages and in our area.

Should we begin drawing on the 401(k)s for income to pay our bills after the savings run out, or should we seek credit counseling to reduce our consumer debt? I’m scared of what our future holds and worried about losing my insurance coverage through COBRA after the subsidy runs out.

Answer: You didn’t say how much consumer debt you have or what your monthly expenses are, but the fact that you’re thinking of tapping your relatively small retirement stash indicates you’re probably in deep trouble.

A debt management plan through credit counseling will work only if you have the extra income to pay off your credit cards over the next five years. If you don’t, bankruptcy may be the better option.

Dear Liz: I took advantage of a 4.99 percent fixed-rate balance transfer offer a couple of years ago. I just received a notice from the issuer that it was increasing my minimum payment from 2 percent to 5 percent. Clearly, I’m not profitable enough, and now it’s seeking to get rid of me fast! Suggestions?

Answer: Many borrowers who have low fixed rates will probably lose them or see their terms change in coming months as credit card issuers cope with higher defaults and new federal regulations.

You have several options, none of which you’ll like:

You can pay off your balance at the new, faster rate, which will get you out of debt fairly quickly while preserving your current rate (unless your issuer changes its mind about that, too).You can transfer your balance to another low-rate offer, which probably won’t be fixed and may not last very long.You can default on your debt if you can’t afford the payments, which would trash your credit.You can learn that carrying credit card balances always has been and always will be a sucker’s game.Liz Pulliam Weston is the author of the book “Your Credit Score: Your Money and What’s at Stake.” Questions for possible inclusion in her column may be sent to 3940 Laurel Canyon Blvd., No. 238, Studio City, CA 91604, or via the “Contact Liz” form at

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