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a FICO Credit Score
Along with the credit report, lenders can also buy a credit score
based on the information in the report. That fica score is calculated
by a mathematical equation that evaluates many types of information
that are on your credit report at that agency. By comparing this
information to the patterns in hundreds of thousands of past credit
reports, the score identifies your level of future credit risk.
In order for a FICO credit score to be calculated on your credit
report, the report must contain at least one account which has been
open for six months or greater. In addition, the report must contain
at least one account that has been updated in the past six months.
This ensures that there is enough information - and enough recent
information - in your report on which to base a score.
About FICO scores
Credit bureau scores are often called "FICO scores" or
fica scores because most credit bureau scores used in the US are
produced from software developed by Fair Isaac and Company. FICO
scores are provided to lenders by the three major credit reporting
agencies: Equifax, Experian and TransUnion.
FICO scores provide the best guide to future risk based solely
on credit report data. The higher the score, the lower the risk.
But no score says whether a specific individual will be a "good"
or "bad" customer. And 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 and there are many additional factors that lenders use to
determine your actual interest rates.
Other Names for FICO Scores
FICO scores (often mistaken as fica scores) have different names
at each of the three credit reporting agencies. All of these scores,
however, are developed using the same methods by Fair Isaac, and
have been rigorously tested to ensure they provide the most accurate
picture of credit risk possible using credit report data.
| CREDIT REPORTING AGENCY |
FICO SCORE |
| Equifax |
BEACON Score |
| Experian |
Experian/Fair Isaac Risk Model |
| TransUnion |
EMPIRICA Score |
More than one fica score
In general, when people talk about "your score", they're
talking about your current FICO score. However, there is no one
score used to make decisions about you. This is true because:
- Credit bureau scores are not the only scores used.
Many lenders use their own fica scores, which often will include
the FICO score as well as other information about you.
- FICO credit scores are not the only credit bureau scores.
There are other credit bureau scores, although FICO scores are
by far the most commonly used. Other credit bureau scores may
evaluate your credit report differently than FICO credit scores,
and in some cases a higher score may mean more risk, not less
risk as with FICA credit scores.
- Your score may be different at each of the three main credit
reporting agencies.
The FICO credit score from each credit reporting agency considers
only the data in your credit report at that agency. If your current
scores from the three credit reporting agencies are different,
it's probably because the information those agencies have on you
differs.
- Your FICO credit score changes over time.
As your data changes at the credit reporting agency, so will any
new score based on your credit report. So your FICO credit score
from a month ago is probably not the same fica score a lender
would get from the credit reporting agency today.
Order a FICO Credit Score
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