What is FICO Credit Score?

FICO is the credit score system used by most creditors today. It is useful in directing applications to specific loan programs and to set levels of underwriting. FICO score is widely used because it is objective, consistent, accurate and fast. Your 3 digit FICO score will determine what interest rate you will pay on your credit cards, mortgages, and auto loans.

How Are FICO Scores Calculated?

Approximations;

Beginning the first quarter of 1998, FICO models treat all inquiries occurring within a 14-day period as one inquiry. In addition, most models will ignore all auto-and mortgage-related inquires that occur within a 30-day period before calculating your score.

You Should Know Your Credit Score

• A  guideline to measure improvement
  
  Improving credit score requires discipline. Understanding your obligations and meeting them responsibly reflects personal growth. A high credit score is a point of pride and confidence in today's world.

For years now, customers have been barred from ever seeing their FICO scores and the method whereby their FICO scores were obtained. But after many years of pressure by consumers and legislators, now you will not only be able to obtain your FICO score from your loan officer, but you will also be able to go on-line and find out the specific factors that are affecting your score. Order your credit report now with FICO score
Free Credit Report

Reminder

Remember that the lender, not a credit score, makes the final decision to approve a mortgage loan application. A credit score is simply a tool used by the lender. The lender may take into consideration any special reasons for your past credit problems. In addition the lender will look at more than just your credit score such as your equity investment in the home, job history, income, savings, and the type of mortgage loan you want -- before making a final decision.

What is considered to be a good fico score?

Lenders criterion vary. There is no exact line of good to bad, bad credit ends where good credit begins! Below is a general idea of what a lender might consider as a credit rating. Keep in mind this is not a hard fast rule, lending policies are up to individual credit grantors and these numbers are approximations.

FICO reason codes

• Amount owed on accounts is too high;

• Delinquency on accounts;

• Too few bank revolving accounts;

• Too many bank or national revolving accounts;

• Too many accounts with balances;

• Consumer finance accounts;

• Account payment history is too new to rate;

• Too many inquiries in last 12 months;

• Too many accounts opened in last 12 months;

• Proportion of balances to credit limits is too high;

• Amount owed on revolving accounts is too high;

• Length of revolving credit history is too short;

• Time since delinquent is too recent or unknown;

• Length of credit history is too short;

• Lack of recent bank revolving account information;

• No recent non-mortgage balance information;

• Number of accounts with delinquency;

• Too few accounts currently paid as agreed;

• Time since derogatory public record or collection;

• Amount past due on accounts;

• Serious delinquency, derogatory public record or collection;

• Too many bank or national revolving accounts with balances;

• No recent revolving balances;

• Proportion of loan balances to loan amounts is too high;

• Lack of recent installment loan information;

• Date of last inquiry too recent;

• Time since last account opening is too short;

• Number of revolving accounts;

• Number of bank revolving or revolving accounts;

• Number of established accounts;

• No recent bankcard balances;

• Too few accounts with recent payment information.

 What is FICO

FICO scores were developed by Fair Isaac Company, Inc. for each of the major credit bureaus. The scores are: (Equifax) Beacon, (Experian formerly TRW) Experian/FICO and (Trans Union) Empirica. They are simply credit scores that only consider the information contained in a person's credit file; they do not consider a persons income, savings or amount of a down payment for a mortgage, credit card or auto loan.

Your score may be different at each of the three main credit reporting agencies. The FICO score from each credit reporting agency considers only the data in your credit report at that agency. While many lenders use FICO scores to help them make lending decisions, each lender has its own strategy, including the level of risk it finds acceptable for a given credit product. There is no single cutoff score used by all lenders. FICO score is based on the information in your credit report located at that particular credit bureau. The actual scoring process is proprietary, and the algorithms are copyrighted. A score is determined by summarizing a number of factors in your credit report.

Government Information

FTC  Federal Trade Commission

If the date on the listing on your credit report from a credit agency is incorrect.
The FTC website won a Civil Penalty against a collection agency for violation of the FCRA.
 NCO Group to Pay Largest FCRA Civil Penalty to Date