For credit card approval, FICO Bankcard Scores 2, 4, 5, and 8 plus FICO score 3 are used.The most generally used FICO® Score versions, along with their uses, are the following: As a result, a higher FICO score enables an individual or business to get faster loan approvals by lenders and vice versa. Moreover, the higher FICO scores depict the exception creditworthiness, and the lower score depicts the worst credit record of a borrower. Almost 90% of all the major lending institutions utilize the scoring before approving a loan.įICO gives a varied output of scores depending upon the type of score the lender check and the type of credit bureaus use. Credit agencies compile this score from the borrower’s credit reports and credit history.įICO scoring model is based on five different parameters – payment record (35%), balance loan amount ( 30%), credit age (15%), loan mix (10%), and recent loan applications (10%). It is a three-digit number like any other credit score that assesses the risk in lending money. It is a United States company-owned brand and proprietary credit scoring model that assesses the creditworthiness of any aspiring or existing borrower applying for a loan from a financial institution. The different parameters and their respective weightage differ from credit scoring companies.įICO is the short form of Fair Isaac Corporation that prepares credit rating models. It is calculated using different parameters – payment record (35%), balance loan amount (30%), credit age (15%), loan mix (10%), and recent loan applications (10%) It depends on the score generation company, with a minimum of one month. The company needs at least six months of data to prepare the report. The ideal range of excellent scores varies from company to company based on their credit rating software. The ideal range for an excellent score is between 720 to 850. It is a generic form of scoring which does not form the industry standards of credit rating but uses an industry-approved credit scoring model to gauge the credit risk and credit worthiness of bowers. It is used by most lenders while going through the borrower’s application. It depends on the scoring model which the company is using at its disposal. The model of scoring is between 300 to 850 It is a generic term for calculating a borrower’s creditworthiness by various companies using different parameters and softwares. It is a company conducting credit scores. Here is a comparison table that depicts the differences between FICO score vs credit score: Category
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