Credit Score Range
FICO Score Chart
FICO, on the other hand, is the abbreviation for Fair, Isaac and Company, the company that first started credit scoring system in 1958 and used widely today to evaluate a borrower s credit worthiness.
Understanding FICO Score
FICO score is a 3-digit numerical index which represents an estimate of your financial credit worthiness. It is the most important number lenders used to determine who qualifies for a loan, at what interest rate, and to what credit limits.
It is based on a subset of the information in your credit report, typically from the three major American credit bureaus: Equifax. Experian. and TransUnion. Though the scoring system used by all three credit bureaus are different but all point to one conclusion and that is whether or not you have good or bad credit.
Creditors or lenders, such as banks and credit card companies, primarily use FICO scores to determine credit limits and interest rates every time when you apply for new credit card, mortgage, auto loan, personal credit line or any other credit issues by the bank. This scores have proven to be very predictive in assessing the creditworthiness of a person or the likelihood that person will pay his or her debts.
FICO Score Chart
FICO score ranges between 300 to 850. The higher is your credit score is, the lower the risk is to the lenders and the easier you’ll obtain a loan, so to speak. A low score, such as 500, could result in much higher interest rates or having your application rejected outright. Conversely, those with a credit score of 760 – 850 would get the most favorable interest rates.