Overview of FICO® Scores

Your FICO® Score is one of many factors nearly all lenders in the U.S. consider when they make key credit decisions. In fact, US News and World Report stated that "The FICO® Score is the No. 1 piece of data to determine how much you'll pay on a loan and whether you'll get credit." Such decisions include whether to approve your credit application, what credit terms to offer you and whether to increase your credit limit once your credit account is established.

FICO® Scores are used by thousands of creditors including the 50 largest lenders, making it the most widely used credit score.

  • Experts at TowerGroup estimate that when lenders get credit scores from credit bureaus, more than 90 percent of the time they ask for FICO® Scores.
  • FICO® Scores are used today in more than 20 countries on five continents as well as by the top 50 U.S. financial institutions, the 25 largest U.S. credit card issuers and the 25 largest U.S. auto lenders.

While the FICO® Score is used in 90% of lending decisions, lenders consider other factors when making credit decisions. Other factors lenders might use include: information you provided on your credit application, how much you earn, your regular expenses, and how you manage your credit, checking and savings accounts.

Your FICO® Score can influence other decisions, too. Your FICO® Score may be used when you apply for a cell phone account, cable TV and utility services.


When you accept new credit and manage it diligently by consistently paying as agreed, you demonstrate to lenders that you represent a good credit risk. Lenders use your credit history as a way of evaluating how well you've managed your credit to date.

A FICO® Score is a three-digit number calculated from the credit information on your credit report at a particular point in time. The FICO® Score summarizes information in your credit report into a single number that lenders can use to assess your credit risk quickly, consistently, objectively and fairly. Lenders use the FICO® Score to estimate your credit risk - how likely you are to pay your credit obligations as agreed. It also helps you obtain credit based on your actual borrowing and repayment history, without consideration of prohibited types of information such as race or religion.

In addition to the three-digit number, FICO® Scores include "score factors" which are the top factors that affect the score. Addressing some or all of these score factors can help you improve your financial health over time. Having a good FICO® Score can put you in a better position to qualify for credit or better terms in the future.


Your FICO® Score takes into consideration five main categories of information in a credit report. The chart below shows the relative importance of each category to your FICO® Score.

FICO® Score Ingredients

Below is a detailed breakdown of each category. As you review this information, keep in mind that:

  • A FICO® Score takes into consideration all of these categories, not just one or two.
  • The importance of any factor (piece of information) depends on the information in your entire credit report.
  • Your FICO® Score looks only at the credit-related information on your credit report.
  • Your FICO® Score considers both positive and negative information on your credit report.

1. Payment History

Approximately 35% of your FICO® Score is based on this information, which includes:

  • Payment information on many types of accounts:
    • Credit cards - such as Visa®, MasterCard®, American Express® and Discover®.
    • Retail accounts - credit from stores where you do business, such as department store credit cards.
    • Installment loans - loans where you make regular payment amounts, such as car loans and mortgage loans.
    • Finance company accounts.
  • Public record and collection items - reports of events such as bankruptcies, foreclosures, lawsuits, wage attachments, liens and judgments.
  • The number of accounts that show no late payments or are currently paid as agreed.

2. The Amounts You Owe

Approximately 30% of your FICO® Score is based on information which evaluates your indebtedness. In this category, your FICO® Score takes into account:

  • The amount owed on all accounts.
  • The amount owed on different types of accounts.
  • Whether you are showing a balance on certain types of accounts.
  • The number of accounts where you carry a balance.
  • How much of the total credit line is being used on credit cards and other revolving credit accounts.
  • How much is still owed on installment loan accounts, compared with the original loan amounts.

Credit utilization, one of the most important factors evaluated in this category, considers the amount you owe compared to how much credit you have available. For example, if you have a $2,000 balance on one card and a $3,000 balance on another, and each card has a $5,000 limit, your credit utilization rate would be 50%. While lenders determine how much credit they are willing to provide, you control how much you use. FICO's research shows that people using a high percentage of their available credit limits are more likely to have trouble making some payments now or in the near future, compared to people using a lower level of credit.

Having credit accounts with an outstanding balance does not necessarily mean you are a high-risk borrower with a low FICO® Score. A long history of demonstrating consistent payments on credit accounts is a good way to show lenders you can responsibly manage additional credit.

3. Length of Credit History

Approximately 15% of your FICO® Score is based on this information.

In general, a longer credit history will increase your FICO® Score, all else being equal. However, even people who have not been using credit long can get a good FICO® Score, depending on what their credit report says about their payment history and amounts owed. Regarding your length of history, your FICO® Score takes into account:

  • How long your credit accounts have been established. Your FICO® Score can consider the age of your oldest account, the age of your newest account and the average age of all your accounts.
  • How long specific credit accounts have been established.
  • How long it has been since you used certain accounts.

4. New Credit

Approximately 10% of your FICO® Score is based on this information. FICO's research shows that opening several credit accounts in a short period of time represents greater risk - especially for people who do not have a long credit history. In this category your FICO® Score takes into account:

  • How many new accounts you have opened.
  • How long it has been since you opened a new account.
  • How many recent requests for credit you have made, as indicated by inquiries to the credit reporting agencies.
  • Length of time since credit report inquiries were made by lenders.
  • Whether you have a good recent credit history, following any past payment problems.

Looking for an auto, mortgage or student loan may cause multiple lenders to request your credit report, even though you are only looking for one loan. The FICO® Score compensates for this shopping behavior in the following ways:

  • The FICO® Score ignores auto, mortgage, and student loan inquiries made in the 30 days prior to scoring. So, if you find a loan within 30 days, the inquiries won't affect your score while you're rate shopping.
  • After 30 days, the FICO® Score counts inquiries of the same type (i.e., auto, mortgage or student loan) that fall within a typical shopping period as just one inquiry when determining your score.

5. Types of Credit in Use

Approximately 10% of your FICO® Score is based on this information.

Your FICO® Score considers your mix of credit cards, retail accounts, installment loans, finance company accounts and mortgage loans. It is not necessary to have one of each, and it is not a good idea to open a credit account you don't intend to use. In this category your FICO® Score takes into account:

  • What kinds of credit accounts you have. Do you have experience with both revolving (credit cards) and installment (fixed loan amount and payment) accounts, or has your credit experience been limited to only one type?
  • How many accounts you have of each type. Your FICO® Score also looks at the total number of accounts you have. For different credit profiles, how many is too many will vary depending on your overall credit picture.


FICO® Scores give lenders a fast, objective and consistent estimate of your credit risk. Before the use of scoring, the credit granting process could be slow, inconsistent and unfairly biased. Here are some ways FICO® Scores help you.

Get credit faster

FICO® Scores can be delivered almost instantaneously, helping lenders speed up credit card and loan approvals. This means when you apply for credit, you'll get an answer more quickly. Today, many credit decisions can be made within seconds. Even a mortgage application can be approved much faster for borrowers who score above the lender's minimum score requirement. FICO® Scores also allow retail stores, internet sites and other lenders to make "instant credit" decisions. Keep in mind that FICO® Scores are only one of many factors lenders consider when making a credit decision.

Credit decisions are fairer

Using FICO® Scores, lenders can focus on the facts related to credit risk, rather than their personal opinions or biases. Factors such as your gender, race, religion, nationality and marital status are not considered by FICO® Scores. So when a lender uses your FICO® Score, it is getting an evaluation of your credit history that is fair and objective.

Older credit problems count for less

If you have had problems paying bills in the past, FICO® Scores won't haunt you forever (unless you continue to pay bills late). The impact of past credit problems on your FICO® Score fades as time passes and as recent good payment patterns show up on your credit report.

Remember, FICO® Scores are time-proven and tested numerical representations of information in your credit reports. So it's important to check your reports for accuracy at all three major U.S. credit reporting agencies. All U.S. consumers may request their free credit report each year from AnnualCreditReport.com.

For answers to the complete set of potential questions you may have about FICO® Scores, download the complete FICO® Score FAQs or FICO Consumer Education.

FICO is a registered trademark of Fair Isaac Corporation in the United States and other countries. First Bankcard and FICO are not credit repair organizations as defined under federal or state law, including the Credit Repair Organizations Act. First Bankcard and FICO do not provide "credit repair" services, advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating.

All FICO® Score materials are Fair Isaac proprietary information. © 2018 Fair Isaac Corporation. All rights reserved.