Understanding how lenders
use credit scores

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You already know that most of the top lenders (90% of them) use FICO® Scores (the top name in credit scores) when making lending decisions (probably because we’re always telling you about it). But what does that actually mean? What really goes down when you apply for a loan? Whether it’s an automated approval process or a 60-day mortgage close, a lender is doing a lot to figure out if you’re going to pay them back on time or not. Here are a few things that might help you understand the approval process.   FICO Scores are designed to help evaluate your risk FICO® Scores aren’t just an arbitrary number provided on a whim. They are based on complex, mathematical algorithms that statistically evaluate a consumer’s credit risk with a point system. Points are assigned for … [Read more...]

Introducing industry-first technology from myFICO

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We have a huge announcement to make. Actually, make that four huge announcements. When we introduce new technology and features, we really like to make a splash.   We’ve listened to your requests, complaints, suggestions and praise and developed three new products that we think you’re going to love. In fact, we’re leveraging technology that’s never before been available to consumers. So without further ado, allow me to introduce three new products and more from myFICO.   FICO® 3-Bureau Credit Monitoring For the first time ever and exclusively at myFICO, you can now monitor three FICO® Score — one from each credit bureau — and monitor all three of your credit reports. This intelligent new product will help you get a better understanding of your full credit picture. … [Read more...]

Revolving vs. installment credit: Which type of credit is best for you?

BLOG - Revolving vs Installment credit - Which credit is right for you

  With the economy recovering, consumers are slowly starting to gain more confidence. Many people are beginning to think about expenditures they have been holding off on as they felt less confident about the economy.  You know … getting that roof repaired that has been on the “fix it” list for a while, trading in that 10-year-old car or finally taking a “real” vacation instead of the “stay-cations” you’ve had over the past several years.     While some people will leverage their savings to fund these expenditures, others may want access to new credit.  If you are in this position and plan on applying for credit, now is the time to think through options and determine which is the best fit for your profile and needs. Here’s a few things you should do … [Read more...]

Announcing myFICO Feature Enhancements!

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  Great News! Enhanced FICO® Score Explanation Report (based on Experian credit report) now available.           Starting yesterday afternoon, all myFICO solutions based on Experian credit report data  (FICO Standard, FICO Score 3-Report View) will now include a newly designed FICO Score explanation report design to help you better understand and manage your FICO Score.       New explanation features include:   Incorporation of positive factors impacting your FICO® Score. Positive factors reinforce the good credit behaviors of high achievers, and encourage those people who may be working to manage their credit or improve their financial health. Personalized credit analysis and comparisons to … [Read more...]

myFICO Welcomes Financial Literacy Month

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While April is the official National Financial Literacy Month, we at myFICO like to think that sound financial literacy practices should be a 24/7 common practice for everyone.     And why shouldn’t it be when having a strong understanding of how to create/stick with a budget, the benefits of investing and saving, how the credit system works, how lenders evaluate applications for credit, how interest fees accrue and knowing your consumer rights can all save you thousands of dollars and loads of time.     At myFICO, we focus on that part of financial literacy related to consumer credit and encourage everyone to participate in this year’s National Financial Literacy month with the following activities:     Check your credit reports to … [Read more...]

The Who, Why and How Behind Your Credit Health

As a writer in the personal finance sector, I spend a lot of time reading blogs about how to improve or establish credit. The information out there is great. I’ve come across tons of articles that offer a variety of ways to improve your credit score. Reading between the lines, it’s become pretty clear to see that there is one thing that is most important above all when working on your credit. It’s not a credit card, it’s not a budget, and it’s not a plan. No, it’s a general understanding of how your credit works, and why you have a score in the first place.   Let’s Start With The Why   Credit scores didn’t just happen. There was a genuine need for a way to gauge the creditworthiness of consumers, businesses, and even entire countries. The reality is, before credit … [Read more...]

Infographic: FICO High Achievers Show You How to Get Your FICO Score Above 800

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Our studies consistently show that people with FICO® Scores over 800 have strikingly similar credit habits. We like to call these people FICO High Achievers, and you can learn from all 36 million of them. Check out this infographic and compare your credit habits to theirs. How do your credit habits measure up?   … [Read more...]

Lenders can see all 3 and now you can too!

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The US credit reporting system can be confusing at times: there are multiple credit bureaus, a variety of credit scores, and a bunch of rules and regulations regarding the permitted use of this information.   It can sometimes drive a person crazy trying to figure it all out!   Questions I am frequently asked are: why are there three credit bureaus and three FICO® Scores?  Do I need to stay on top of just one or all three?  Does my lender pull all three or just one?  Which one?   In the U.S. there are three national credit bureaus (Equifax, Experian and TransUnion) that collect, update, store and sell our credit histories.  The credit bureaus compete against each other to have the most robust, current and accurate credit information on the US population, … [Read more...]

Understanding the Different Types of Credit Rating Agencies

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If you have been paying attention to credit rating news lately, you will have noticed it isn’t just important to the individual person. Cities like Jacksonville, FL and even the country of France receive credit ratings. From both of these articles, the impacted rating is from the Fitch Group’s Fitch Ratings, and they are based on letter grades rather than a score.   Does this mean you should be concerned about your Credit Rating from Fitch Group or the other credit rating agencies? Before we answer this question, here is an explanation of the two types of credit agencies.   Big Three Credit Rating Agencies The Big Three Credit Rating Agencies are Fitch Group, Moody’s, and Standard & Poor's. The Credit Rating Agencies issue a rating for a debtor based on their … [Read more...]

Your FICO® Score Based on Experian Data Now Available!

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Exciting news -- you can now access your FICO® Score based on Experian data at myFICO.com.  This makes myFICO.com the only place consumers can get FICO® Scores and credit reports from all three credit bureaus.  Why is this important?  Because your lender may be looking at FICO® Scores  and credit reports based on data from all three credit bureaus, or may be using just one of the three, but you have no way of telling which one.  Let me explain.   In the U.S., there are three national credit bureaus (Equifax, Experian and TransUnion) that house credit histories on most of us.  Each of these agencies uses the FICO® Score algorithm to produce a version of the FICO® Score based on the data they collect on each consumer.  Lenders request these scores when evaluating consumer credit … [Read more...]

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