A Quick Breakdown of the 5 Categories of Your FICO Score
A better understanding of the most used credit scoring model
FICO Score is the most used credit scoring model using by issuers when you are applying for a credit card or loan. How do I know this? As stated on the FICO Score website, “FICO Scores are used in over 90% of U.S. lending decisions.”
FICO stands for Fair Isaac Corporation, which is a leading data analytics company focused on credit scoring services. FICO Score was first introduced in 1989 and has become a standard credit scoring model since then. FICO Scores range from 300 to 850. Generally, scores ranging from 300 to 579 are poor, 580 to 669 are fair, 670 to 739 are good, 740 to 799 are very good, and 800 to 850 are exceptional.
FICO Score is currently on its 9th version, with the 10th version expected to be released later this year. Even though the 9th version of FICO Score is the latest, the 8th version is still the most widely used by Experian, Equifax, and TransUnion. With each update to FICO Score, factors and categories are adjusted to reflect consumer demand and use of credit better.
When it comes to your FICO Score 8, your data is calculated using many different pieces of your credit report and grouped into 5 categories. The following are the 5 categories: payment…
