A free FICO score is what most people commonly refer to as their credit score. FICO which stands for the Fair Isaac Corporation, was developed as a company that provides a numerical score for all individuals who have ever
received any type of credit in their lives. A person’s FICO score is a numerical snapshot of their financial
management skills and the risk that a potential lender would take to lend that person money. The higher the FICO
score the lower the risk, the lower the score, the higher the risk. This score is used by virtually every major
financial services company to help them make their difficult decisions surrounding who they will lend money to,
and at what rate.
Free FICO Score
As an individual, a FICO score is an incredibly important piece of information. Within the FICO score is a composition of four major pieces of information that combine to make a person’s credit score: The borrower’s complete payment history on all of the loans they have ever taken out, the length of the borrower’s credit file, the number of hard inquiries on the credit report, and the percentage of revolving debt levels to the ceiling of revolving credit limits. These four pieces of data are all weighted differently, but they combine to make up the FICO score.
A FICO score is very important to a financial services company. The credit score allows a lending body to pull a credit score and get an almost instantaneous picture of a person’s financial health. before the credit score was developed, a lending body would have to do research on each person and individually inquire about each of their loans to see how well they paid those loans back. This was very time consuming work and made it almost impossible for financial services companies to run efficiently. The credit score allows a lending body to pull a credit score within minutes, and have a complete financial history of a borrower, as well as a numerical indicator, that the lending body can use to make their lending decision.
FICO Scores
The FICO score has changed how the American financial services business works. It revolutionized the efficiency and accuracy at which a lending body could make a lending decision on an individual and it protected the lending bodies from making bad loans to bad customers. Individuals and businesses alike rely on credit scores for their financial well being and financial stability.
Order your free FICO score here!