Credit Industry Flip-Flops Over Releasing Its Ratings.

ONE minute they're stonewalling, the next minute they're begging you to listen. I'm speaking of the companies that create consumer credit scores.

Right now, you probably don't know your personal credit score, and the industry hasn't wanted to tell you.

Within a year, however, they'll be falling all over themselves to disclose. The knowledge should help you handle your money a little better.

A credit score tells you how you stack up as a borrower, compared with the rest of the population. The more traits you share with people who pay their bills on time, the higher you rate.

The most widely used scores are based entirely on the information in your credit report, such as whether you've ever paid bills late. Generally speaking, 720 is a high score and 585 a low one.

When you apply for a credit card, mortgage or other loan, lenders check your credit history and your score. They may also add other data, such as the size of your income.

If you score high, you'll get the loan on the best terms. Middle-range scorers get loans, but perhaps at a higher interest rate. Low scorers will find it hard to get any credit at all. Every lender sets its own cutoff points.

The leading creator of scoring systems is Fair, Isaac, in San Rafael, Calif. Just a month ago, Fair, Isaac's Craig Watts explained to me, carefully, why it would damage the American way of credit to let people learn about their scores.

In fact, Fair, Isaac and the credit bureaus have generally prohibited the lenders from disclosing specific scores.

Well, Fair, Isaac has changed its mind.

Last month, Trans Union, a credit bureau that sells a competing scoring system, announced that it plans to create and disclose individual credit scores. The scores should be available before the end of the year, to people who order credit reports.

Another credit bureau, Experian, is looking at this question, too.

Fair, Isaac jumped on the bandwagon. Watts says his company acted because disclosure legislation has been proposed in California and in Congress. But perhaps a bigger reason is the competition. "We'd better step in to provide an alternative source of information," he says.

Already, Fair, Isaac has posted a general explanation of what's in your credit score (see its Web site, www.fairisaac.com).

In July, Fair, Isaac wants to begin disclosing your personal Fair, Isaac score, called a FICO score. You'd also get specific advice on how to raise it. The price for this service hasn't been determined yet, Watts says.

But there's a glitch. Although Fair, Isaac creates the computer program that generates credit scores, it doesn't have access to your credit report. Without the report, it can't determine your personal score.

Credit reports are compiled and held by credit bureaus. Fair, Isaac is asking the bureaus for access. How will the bureaus respond?

Trans Union's Walter Rothschild, executive vice president of marketing, says "Trans Union took the lead on credit score disclosure." It's in discussions with Fair, Isaac now.

Experian spokesman Don Gerard says his company is keeping its options open. "This is a new frontier," he says.

The third major credit bureau, Equifax, is keeping mum.

If Fair, Isaac doesn't get access to the credit reports, it won't be able to give you scores. But it says it will explain any FICO score that you happen to get from a lender.

It doesn't take a genius to know what goes into a good credit score. The first item is paying bills on time. Paying 30 days late isn't as bad as paying 90 days late. But a black mark five years ago matters less than a black mark last month.

Next comes the amount you owe. You're marked down if you own many credit cards and are close to the credit limit on all of them.

Closing unused accounts will generally not raise your score, Watts says. In some cases, your score might even drop. That could happen if you are close to the credit limit on all your remaining cards.

Your score usually drops if you apply for several new loans or credit cards at the same time.

But comparative shoppers aren't hurt by applying for several mortgages or auto loans, if they do so in a cluster. (Comparative shopping used to lead to a black mark, too, until Fair, Isaac changed this policy in 1998.)

Changing your credit habits won't change your score right away. But over time, the bad karma goes away.

Are Bonus Annuities Fulfilling Promises?

Step right up, folks, have I got a deal for you! A variable annuity that pays you a bonus when you invest. Free money! Start out richer right away!

Sigh. Here we go again.

Variable annuities are one of the insurance industry's most aggressively sold products. They're basically mutual funds wrapped in insurance annuities.

You choose the funds (or "subaccounts") you want to invest in. The gains accumulate tax-deferred. You pay ordinary income taxes when you take the money out.

But the new, free-money pitch has rightly attracted the eye of the money cops. The Securities and Exchange Commission is looking into whether you're being sold a bonus that isn't real. Here's what's going on:

Say you invest $10,000 in an old-style variable annuity. That's the amount you start out with in your account. The agent earns a sales commission, but it doesn't come out of your money up front. You pay it over time, in annuity fees.

With a bonus annuity, the insurer adds an extra 1 Percent to 5 percent to your account. If you put up $10,000, you might start with $10,500 to invest.

This creates a terrific opportunity for sales agents. They go to people who have annuities already and offer them up to 5 percent to switch to a new one, in a tax-free exchange. The agent earns a commission for getting you to switch. You imagine that you've picked up a bonus, free.

But where does The insurance company get the money to pay the bonus?

From you, of course, where else? Your lovely new investment carries extra fees, including:

The SEC wants to know whether the sales are suitable in every circumstance, and whether the cost was fully disclosed.

So follow the money -- your money. Bonus annuities add up to smoke and mirrors. They're likely to cost you more in the end.