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Today, I’m going to talk about the FICO® SCORE?

But first, if you’re new to the crew – welcome! 

Alright, now let’s jump right into Debt 



Fair Isaac Corporation ("FICO") debuted the FICO® Scores 30 years ago to provide lenders and consumers with a fair way to score creditworthiness.

Your FICO® Score helps lenders determine how likely you are to repay a loan based on information on your credit report. 

This, in turn, affects how much you can borrow, how many months you have to repay, and how much it will cost (the interest rate).

So, Is the score important????

Absolutely YES…

Your FICO® Score is one of the things lenders look at when deciding whether to lend you money. It is more like a summary of your credit report.  The score measures  how long you've had credit, how much credit you have, what you're using of your available credit, and if you've paid your bills on time.

When you need credit, it helps you get it fast and fair. Your FICO® Score depends on how you pay your bills, don't carry too much debt, and make smart credit choices, so you can influence it.

Many insurance and utility companies check FICO® Scores when setting up the terms of their services in order to make sure you qualify for credit to get an education, buy a house, or even cover medical expenses.

If you have a good FICO® Score, you can save thousands of dollars in interest and fees since lenders will be more likely to offer lower rates if you're less of a risk.


Most lenders consider scores above 670 to be good creditworthiness.

Creditors are more likely to lend to you if your score is high. Score ranges are recognized by creditors to help them make lending decisions. You can also use them to set goals for yourself.

Your credit scores are determined by five major factors:


1. Payment History:

(record of on-time, late, and missed payments on past and current credit accounts.)


2. Debt Utilization:

If you use credit cards responsibly, you will have access to additional funds in an emergency. You can build credit records to receive a credit score. You can also finance large purchases that might take a few months to pay off, earn points or cash-back rewards on your monthly spending, as well as services like roadside assistance, travel plan assistance, and upscale airport lounges while traveling.


3. Age of Credit Accounts: 

About 15% of your credit score is made up of “Length of Credit History.”.

From the date your credit report was opened until the present, the Average Age of accounts equals the total number of years and months. 15% may not sound like much, but a longer credit history can help improve your credit score. This section accounts for 15% or 82.5 points.


4. Types of Accounts 

  • Revolving account: There is a different payment due every month for a revolving account. You do not have to pay in full each month for these accounts. You can “revolve” some or all of your balance to the following month.

  • Installment Accounts: Unlike revolving accounts, installment accounts have a fixed monthly payment. As with revolving accounts, you’re not required to pay in full every month. You make a payment every month until the loan is repaid.

  • Credit Builder Loans: Credit builder loans are offered by some financial institutions. You put some money down in a savings account and pay yourself back. Once it’s paid back, you gain access to the savings that you put in.

5. New Credit/Inquiries


  • Credit inquiries are requests by “legitimate businesses” to check your credit. For FICO® Score purposes, credit inquiries are categorized as either “hard inquiries” or “soft inquiries”.

  • In a soft inquiry, your credit is not being reviewed by a lender.Among these are inquiries made by businesses that offer you goods or services–such as promotional offers from credit card companies–or inquiries made by businesses with whom you already have a credit account–such as checking your own credit score in myFICO.

Hope you got some good info about FICO  from this newsletter

😊 Thanks for reading and subscribing.

I’m Daraine Delevante, a Consumer Law Expert whose knowledge and expertise is predicated on accountability and results.

🧑‍🏫I teach average and elite consumers how to repair, rebuild, and restore their credit using consumer laws.

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