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Understanding FICO Scores

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FICO® scores were developed by Fair Isaac & Company, Inc. for each of the credit repositories - (Equifax) Beacon®, (Experian formerly TRW) Experian/FICO and (TransUnion) Empirica®. They are simply repository scores meaning they only consider the information contained in a person's credit file; they do not consider a persons income, savings or amount of a down payment for a mortgage. Basically, the scores were designed to assess risk or a person’s likelihood to pay back a loan. The portion of the credit file considered and the weight (as provided by Fair Isaac) are as follows: Previous credit performance (35%) Trade line information specific to payment history Current level of indebtedness (30%) Current balance compared to the high credit Time credit has been in use (15%) Opening date Types of credit available (15%) Installment loans, revolving accounts, debit accounts Pursuit of new credit (less than 5%) Inquiries In their booklet, "Understanding your FICO® score" (av