Fair Isaac & Co. (FICO)

Monday December 29th, 2003

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What is the FICO Score and what factors are considered?

One of the most common credit scoring models is the Fair, Isaac and Co. (FICO) score used virtually by all major mortgage lenders to evaluate the credit worthiness of applicants. Your FICO score is available upon request by the applicant.

The FICO score is used by many lenders as a basis for accepting or rejecting applications and setting rates and fees. FICO scores range from 450 to 850 points. To be considered "A" paper, your score needs to be 670 or higher.

Below are the weights and factors assigned to different credit history factors used for the FICO score:

Item	Summary	% of Weight
Payment History	Determined by the payment history on your credit card accounts, from Visa cards to department store and loans. The model assigns greater weight to recent missed payments than late payments years ago.	35%
Outstanding Credit	Based on the amounts you owe creditors. This includes the total of what you owe on all your accounts and whether you carry an unpaid balance on certain accounts like credit cards.	30%
Length of Time	Attributed to the length of time the applicant has been a credit user. The longer, the better, assuming you pay on time.	15%
New Credit Loads	Based on whether you appear to be loading on new credit. In other words, have you been applying for and receiving new loans in recent months. High activity in this category will lower the score.	10%
Mixed Credit Use	Governed by the types and "mix" of your credit use.	10%