Also written as:
FICO
The most widely used credit scoring model in mortgage lending. Developed by the Fair Isaac Corporation. Ranges from 300 to 850.
FICO is the credit scoring model created by the Fair Isaac Corporation, and it's the one virtually every mortgage lender uses to evaluate your credit. While other scoring models exist (most notably VantageScore), FICO is the standard for home loans.
There's actually no single FICO score — there are multiple versions for different industries. Mortgage lenders typically pull FICO Score 2, 4, and 5 (one from each of the three major bureaus: Experian, TransUnion, and Equifax) and use the middle of those three scores. If there are two borrowers, they use the lower middle score.
The FICO model weighs five factors: payment history (35%), amounts owed (30%), length of credit history (15%), credit mix (10%), and new credit (10%).
Example
You have FICO Scores of 738 (Experian), 745 (Equifax), and 752 (TransUnion). The lender uses 745, the middle score. If you're buying with a spouse who has 720/725/730, they use 725 — the lower of the two middle scores.
Also known as
FICO, FICO 2, FICO 4, FICO 5, fair isaac score