Let’s Talk Credit: Understanding your Credit Score
Did you know?
FICO is an acronym for Fair Isaac and Company.
In the 1950’s, Fair Isaac and company created the mathematical calculation that is used to determine your credit score. It is a tool that was designed to determine one’s credit score and dependability in paying bills.
The terms credit score and FICO score are used synonymously.
Twenty or so years ago, lenders and banks would obtain the credit scores from the credit report as a reference point. Loans were based on the overall financial strength of a borrower and their ability to repay a loan. The Scores were important but they were not weighed nearly as they are today when making a decision. If scores were on the low side, compensating factors were looked at such as: additional monthly reserves, the amount of credit accounts you carried, the amount of credit accounts that carry balances, do you have a…
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