alt Hacker NewsJust because that’s what a scores is designed to do it doesn’t mean that’s what businesses use it for downstream.
The fact people always debate what a credit score really means suggests that there are too many factors rolled up into a single number when we should really have a few distinct sub-scales. Anybody that has made a dashboard for a ceo with a short attention span that refuses to deal with nuance and just wants to see “a number” knows this problem all too well
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Yes, which is exactly why Fair Isaac Corp. sells multiple different scoring models customized for different use cases. It's not just one FICO score. For example, auto lenders usually stratify borrowers in a different way from home mortgage lenders. Contrary to the naive hot takes on HN, lender CEOs are well aware of these nuances.
I agree in general, but a credit score absolutely DOES NOT tell you how profitable someone is to lend to, and in general someone with a very high credit score is a very low margin customer.