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What Does FICO Stand For? What is a FICO Score?

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What is a FICO Score

A FICO score is a credit score developed by FICO, a company that specializes in what’s known as “predictive analytics,” which means they take information and analyze it to predict what’s likely to happen.

In the case of credit scores, FICO looks at a range of credit information and uses that to create scores that help lenders predict consumer behavior, such as how likely someone is to pay their bills on time (or not), or whether they are able to handle a larger credit line.

Scores developed by FICO can also be used to forecast which accounts are most likely to end up included in bankruptcy, or which ones will be most profitable. And credit-based insurance scores, which they also create, are used to help insurance companies identify which customers are least likely to file claims.

What Does FICO Stand For?

The name FICO comes from the company’s original name, the Fair Isaac Co. It was often shortened to FICO and finally became the company’s official name several years ago.

To create credit scores, they use information provided by one of the three major credit reporting agencies — Equifax, Experian or TransUnion. But FICO itself is not a credit reporting agency.

Though FICO scores are the most widely used among lenders, there are other scores lenders can choose from, such as the VantageScore, which is becoming more widely used.

What Is a Good FICO Score?

There are actually dozens of FICO scores, with each version serving a different purpose (more on that later). Generally, the FICO score range is 300 to 850, with the higher number representing less risk to the lender or insurer. Consumers with excellent FICO scores (usually around 760 or higher, though every lender has different standards) are likely to get the best rates when they borrow, as well as the best discounts on insurance.

What Goes Into FICO Scores?

There are five main factors that go into FICO scores, and they each have a different effect on your score. Here’s the breakdown:

  • Payment history (35% of the FICO score)
  • Debt/amounts owed (30%)
  • Age of credit history (15%)
  • New credit/inquiries (10%)
  • Mix of accounts/types of credit (10%)

All of these factors are considered in other credit score models, so it’s safe to say that if you have a strong FICO score you likely have a good score with other models as well. However, for some people, the weight of these categories can vary. For example, people who haven’t been using credit for very long will be factored differently than those with a longer credit history, according to FICO. So, the importance of any one of these factors depends on the overall information in your credit report.

That’s why it’s a good idea to not get too hung up on the specific number of your credit score. Instead, focus on what areas of your credit are strong and which ones you might want to work on.

What’s Not in My FICO Score?

While FICO considers a wide range of information to come up with your credit scores, there is a lot of information that is not used. According to FICO, the scores do not consider anything that isn’t on your credit report, which includes your race, religion, national origin, sex, marital status and age. Here are some other things that FICO says it does not factor into its scores:

  • Employment information, including your salary, occupation, title, employer, date employed or employment history
  • Where you live
  • The interest rates on your credit accounts
  • Child or family support obligations
  • “Soft” inquiries (requests for your credit report), which include requests you make to see your own credit reports or scores
  • Any information that has not been proven to be predictive of future credit performance
  • Participation in a credit counseling program

Is There Just One FICO Score?

FICO has dozens of credit score models. Some are specific to what the consumer is applying for. For example, if you’re applying for an auto loan, your potential creditor may use a FICO score formula that gives significant weight to your history of making auto loan payments. Other models are customized for FICO’s clients.

Additionally, FICO updates its general formulas from time to time, with the most recent being the FICO 9 rollout in 2014. Paid collection accounts are not factored into FICO 9 scores, and unpaid medical collections have less of a negative impact on credit scores, compared to other credit scoring models and previous FICO algorithms.

How to Get Your Credit Score

With a free account, you get two free credit scores (one from Experian & the VantageScore 3.0), and they’re updated every 14 days. This is not a trial offer, there is nothing to cancel and you won’t be asked for your credit card information.

You can also purchase a FICO score online, and some credit card companies also provide free credit scores with an account or on your regular statement.

Comments on articles and responses to those comments are not provided or commissioned by a bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by a bank advertiser. It is not a bank advertiser's responsibility to ensure all posts and/or questions are answered.

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  • Gerri Detweiler

    We address a lot of your questions in this article: Why Do I Have So Many Credit Scores?. As for why you have to pay for FICO’s scores, that’s a business decision they have made. They aren’t required by law to provide consumers with free FICO scores.

  • Terry

    The issue is not whether or not you pay your premiums. The issue is the likelihood that you will make a future claim, thus costing the insurance company much more than your insurance premium.

    • Prajith

      Quite funny. If the Insurance company does not intend to pay the customer, then why in the world would someone ever get insured and keep paying premiums..?! Just to feed the insurance company?

      • Katherine Elaine Richardson

        So true,i agree with you

  • andre_janew

    FICO scores are provided for free by Discover and Merrick bank. Discover has the score on your monthly statement, whereas with Merrick you need to log on to your account to get it. According to Credit Karma, my TransUnion score is 680. According to, my Experian score is 704. According to Discover and Merrick bank my FICO scores are 639 and 626, respectively. You don’t have to pay for your scores, you just have to know where to look for them.

    • R

      I can’t seem to find where to access my FICO score on the Merrick Bank website, just a document about understanding how to read your FICO score. I only have a credit card with them, could this be why? They also, unfortunately, don’t have a search bar.

    • Yilin Li

      My score is opposite to yours, . . . My experian is 717, . . . . my transUnion is 734 and Equifax is 736. You just can’t figure out how they calculate the score. No correlation between agencies.

  • Leo

    do medical bills hurt your credit score

  • Gerri Detweiler

    The score you are seeing is the FICO NextGen score. Most FICO ranges are 300 – 850 but this is one of the few that isn’t.

  • unionssuck

    i still do not get it or why i have to pay

  • Joe Boss

    It is nothing more than a scam. I have a 742 average in credit scores from the big three. I understand the analytics behind this FICO Score but disagree with it.

  • jubi

    I don’t know they don’t call FICO what it really is. A debt score because that is what it is based on. For those of us who have no debt, carry no balance on our cards and only use them when necessary, we have no FICO score. And therefore deemed credit unworthy. That is hysterical.


    Insurance Companies also don’t tell you that they base the premium on your credit score from my understanding too.

  • Ram

    One thing I never undersatnd and does not make sense is whenever a contractor checks your credit in order to give you an estimate for a project, credit score gets a hit by few point, even though I have not yet commited to use the credit card ? I have 700+ score suggesting I regularly pay my bills on time for last several decades! So why just inquiring my score gets a hit ?Can someons see any logic in this?

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