What Is a FICO Score?

A FICO Score is a type of credit score created by the Fair Isaac Corporation (FICO). It is used by lenders to evaluate the credit risk of a borrower. The FICO Score has become one of the most popular ways for companies to assess the likelihood that a person will repay their debts on time.

How Is a FICO Score Calculated?

FICO Scores are calculated based on the information in your credit reports from the major credit bureaus: Experian, TransUnion, and Equifax. The specific scoring calculations are proprietary, but FICO shares the general factors that influence the score:

• Payment History (35%): Your history of paying bills on time.
• Amounts Owed (30%): The total amount of debt you owe.
• Length of Credit History (15%): The age of your credit accounts.
• Credit Mix (10%): Your experience with different types of credit accounts.
• New Credit (10%): The number of recently opened credit accounts.

FICO Score vs. VantageScore

While FICO Scores are used by 90% of top lenders, VantageScore is another type of credit score that some companies use. Both scores use similar data but have different scoring models and ranges. FICO Scores range from 300 to 850, while VantageScore also ranges from 300 to 850 but has different weightings for various factors.

Why Are FICO Scores Important?

Your FICO Scores can significantly impact your financial life. They can affect:

• Approval for loans and credit cards
• Interest rates and fees on new credit accounts
• Loan amounts or credit limits
• Rental applications for homes or apartments
• Security deposits for rentals

Improving your FICO Scores can help you get better offers and terms on credit products.

How to Get Your FICO Score for Free

You can get your FICO Score 8 for free from Experian with ongoing score tracking. Many lenders and credit card issuers also provide free access to your FICO Scores. Check with your financial institutions to see if they offer this service.

Contact O1ne Mortgage for Your Mortgage Needs

At O1ne Mortgage, we understand the importance of your FICO Score in securing the best mortgage rates and terms. Our team of experts is here to help you navigate the complexities of the mortgage process. Call us today at 213-732-3074 for personalized mortgage services that meet your needs.