Some basics you need to know
- What is a FICO Score
- Fico Score -VS- VantageScore
- What are the FICO Score Ranges
- The Does & The Don’ts to Improve your FICO Score
What is a FICO SCORE:
A FICO score is a three-digit number that lenders and credit card issuers use to predict how likely you are to repay them if they grant you credit. The score is also used to set the interest rate you’ll pay.
FICO scores were introduced by the Fair Isaac Corp. more than 25 years ago, and they are the most widely known credit score.
The company uses a proprietary formula to gauge your creditworthiness. The formula is applied to data in your credit reports at credit reporting agencies Equifax, Experian and TransUnion.
FICO -VS- VantageScore:
Do not confuse the credit scores that companies such as Credit Karma or Credit Sesame give you with your FICO Score: Credit bureaus Experian, TransUnion and Equifax came up with the algorithm to produce VantageScore in 2006, competing against the better-known FICO scores. Initially, VantageScore was on a different scale than FICO, but the most recent revisions have a 300 to 850 scale, just like FICO’s.
FICO Score Ranges:
- 300-629: Bad credit
- 630-689: Fair credit, also called “average credit”
- 690-719: Good credit
- 720 and up: Excellent credit
Tips on How you Raise Your Credit Scores:
Here are a few companies that I personally recommend my clients subscribe to, and many of these services are FREE:
