Why is the fico score important and why should I know about it?

Fico Score

In Credit Score it was explained that credit agencies gather your credit information and use large databases to calculate your rate, which happens to be the fico score. It is a complex calculation that uses many different factors to determine a numerical result.

This stands for Fair Isaac and Company and the FICO score was primarily used in lending transactions. It utilizes many factors that determine a rating. In additions to lending industry, the insurance and even employers are using credit scores as a way of determining your worthiness.

Is the FICO credit score the only score used?

When put into perspective, this score is the most widely used and is the standard for most credit reporting systems. However CreditXpert and Experian’s PLUS Score are used and compared to FICO scores. These scoring systems are used to determine your credit worthiness which can range from 450-850. Actual scores are seldom the same because each reporting service uses their own credit scoring model and credit data gathered.

How can the Fico scores be useful to the consumer?

There is no one minimum score that is accepted by lenders so it is difficult to gauge the score when calculated by the different credit reporting agencies. As an example a score of 750 may qualify you for a platinum credit card, then a score of 675 may say you best qualify for a standard care.

Although this may sound a bit confusing, this current method of rating has taken away much of the inconsistencies that was once practiced. FICO is now a standard, thus shares a consistency in credit scoring.

Here’s where to get your credit reports.

You can get your individual credit reports from the each of the three major credit reporting agencies:

Order here for Equifax FICO score at Get Equifax Credit Watch Gold 3-in-1 Now! .
Order Trans Union FICO score at http://www.transunion.com
Order here for Experian  at http://www.experian.com

For your convenience you can get your free credit report:

                  Get your FREE credit score and more!