FICO and You

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The Origins of Your FICO Score

Well, lets travel back to the 1960’s with a company by the name of Fair Isaac whom devised a very unique and intricate mathematical computation formula to determine the credibility of consumers who apply for loans. This formula allowed the company to study a person’s personal credit history and generate a 3 digit number to represent the likelihood that the consumer would be able to repay the loan they were applying for. This started the revolution of credit risk scoring for the financial services industry, and enabled financial institutions to improve business performance and expand consumers’ access to credit lending.

 

How the FICO Did They Do That? ficocreditscores 

Your FICO score epitomizes a consumer’s credit history into a Number based on previous credit history, and are calculated by using scoring models and mathematical tables that assign points for different pieces of information which best predict future credit performance. The process on developing these models requires studying thousands, even MILLIONS of people and how they have utilized their credit. Keep in mind, this formula to predict your financial future is so complex that Fair Isaac & Co. and the credit bureaus have not exposed how these scores are actually calculated, which has been ruled acceptable by the Federal Trade Commission. Let’s face it, even if their was a release of knowledge we probably couldn’t calculate it ourselves anyways, unless of course.. you are a mathematical genius! Score model developers find predictive and repetitive factors in the data that have proven to indicate a consumers future credit pursuance.

Is FICO Your Final Answer…?your-credit-score

Fair Isaac has become the pioneers behind credit lending, and is so important in the financial industry that their word on your credit has become the final word. Banks and creditors put a remarkable amount of credibility into just this one company, so why would they? Simply due to their proven track record.

 

If you would like to schedule a FREE consultation with a Credit Advisor today visit our website http://BetterCreditGuaranteed.com or give us a call at 1(800)216-2725