FICO – the topic of this weeks blog. Get comfortable and buckle up because I’ll be doing some Q&A that will hopefully shed some light on this four-letter-acronym.
F-I-CO, or Fair Isaac Corporation was established in 1989, originally started to evaluate Mortgage Loan risk and is now used by 90% of top lenders industry-wide. Sorry to burst your bubble, but FICO is not just a credit score it’s actually a company. More than that, it’s a company that sells proprietary software that can calculate and even predict credit scores based on consumer credit report data by using patented algorithms. That’s pretty interesting to a data-guru such as myself. Let’s begin our Q&A –
What Products Are Offered By FICO Sell?
FICO has an entire library of products! They have everything from Credit Scoring to Network Security. They have a large product library designated solely to Credit Scoring for both Lender and Consumers. That brings us to the next question!
Who Purchases FICO Products and Services?
In the realm of Credit Scores, Lenders, (banks) and Consumers, (you and I) are the customers.
Lenders are anyone that can offer you a line of credit, being a bank or the 3rd party of a bank. FICO sells Credit Scoring software that is Industry-Specific. That means they have software that calculates credit scores for a Consumer within a particular industry. These include Mortgage, Auto, Bankcard, Installment Loans, and Personal Loans. In addition they have the FICO® Base model that is used to calculate consumers general credit scores, this is the number you get when you purchase your FICO score.
What Scores Did I Just Pay For? I Got Them From a Credit Bureau…
If you get your Credit Scores from the three major Credit Bureaus – Experian, TransUnion, and Equifax be sure to always check if it says “FICO SCORE”. This seems obvious but if it’s not clear, then it’s not FICO. The Credit Bureaus partner with FICO to use their Scoring system. But they also sell their own credit scores along with credit reports.
In 2006 the CRC’s (Credit Reporting Companies) collaborated and created Vantage Score. Vantage Score is software made to compete with FICO and get a piece of the credit-score-pie. By combining their forces, the CRC’s created a product to help Lenders with Risk Management as well as attract consumers wanting to check their latest credit scores. By the way, you can check your credit score for free here.
That’s all the spelling for today Folks. If you have a question that I didn’t cover here, simply visit our Facebook Page, find this topic and leave a comment. We’d love to answer your question!
Stay thirsty my Friends