A FICO score is the most common type of credit score. Ranging from three hundred on the low end to eight hundred and fifty on the high end, a FICO score helps lenders decide whether or not to loan money to someone, and if so, what the interest rate should be.
The name FICO comes from Fair Isaac Corporation, the company that invented it in 1989. There are numerous factors that go into how your FICO score is calculated, but two of the most important ones are your history of paying on time and how much debt you currently have.
If you have a high FICO score, you’ll be able to borrow more money at lower interest rates. If you’re planning on taking out a loan anytime in the next five years, I suggest you monitor your FICO score to get it as high as possible. If you have an account with certain financial institutions, like Discover, you can see your FICO score for free.
Do you have questions about your FICO score? Need tips on how to improve it? Let me know in the comments!