![]() Your monthly car payments, your ability to snag the apartment you’ve been eyeing, and even the hiring manager’s decision on the new job you applied for can all be influenced by your credit score. Today, credit scores have much more pull, and that’s why it’s important to understand how they’re calculated. When credit scores were first introduced, they were used primarily for loaning money. Because a consumer's credit file may contain different information at each of the bureaus, FICO® scores can vary, depending on which bureau provides the information to FICO® to generate the score. The FICO® model is used by the vast majority of financial institutions and credit lenders, and is based on consumer credit files from the three national credit bureaus: Experian, Equifax and TransUnion. It was first introduced in 1989 by FICO®, then called Fair, Isaac and Company. The FICO® score is the best known and most widely used credit score model in North America. ![]() The old system was time-consuming, inconsistent and quite biased, so a credit scoring system was introduced. Before then, there was no standardized way to measure creditworthiness, so it was up to individual lenders to make judgment calls on whether or not to loan money to someone. The credit scoring system that we’re familiar with today has been around since the 1980s. Widespread use of credit scores has made credit more widely available and less expensive for many consumers. ![]() Basically, it provides a snapshot of how likely you are to repay your debts on time. It’s a standardized measurement that financial institutions and credit card companies use to determine risk level when considering issuing you a loan or a credit card. What is a Credit Score?Ī credit score is a number (usually between 300 and 850) that represents your creditworthiness. You’ve heard about credit scores before, but what do you actually know about them? How long have they been around? How do you check them? How are they calculated? We’re here to help you answer these questions and more. ![]()
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |