What does FICO stand for? What is FICO score? All about the FICO score rating.
FICO stands for Fair, Isaac and Company, the company that historically assigned credit ratings.
What is FICO score?
The FICO score is the most important credit rating used by creditors to determine your risk level – and therefore, the interest rates you are eligible for. Banks and credit card companies regularly make credit report inquiries to establish a person’s credit status. Whenever you need a loan of any form, be it a mortgage or a car loan, your FICO score will determine what interest rates you end up being eligible for.
Employers and landlords also make use of FICO scores to establish your level of credit trustworthiness before they enter into any financial arrangements with you.
Definition: FICO Score
Your FICO score is officially defined as a numeric value that reflects your credit habits and history.
What is the average FICO score? It is usually in the mid 600s. This means that you will fall in the middle two credit ranges.
Good FICO score
What is a good FICO score? Generally, any score that falls in the top range (720 and above). If your FICO score is in this range, you will be eligible for the very best interest rates available.
Highest FICO score, Maximum / Perfect FICO score
The top range runs from 720 to 850, so the highest FICO score is 850. Achieving the maximum FICO score is a rare feat; you will have no problems securing credit, as a perfect FICO score makes you extremely credit trustworthy in the eyes of creditors.
FICO score: Car loan, mortgage, bank loans, student loans
There are many instances where you would need a good FICO score. Basically, any time you need to borrow money from someone else.