Everything you want to know about FICO® Score

Posted on Feb. 28 2022 By: Oneblinc 5 min. read

If you’ve ever applied for a loan or mortgage, you probably heard of a FICO® Score. But those numbers might seem intimidating and confusing for a lot of people. If you’ve ever felt lost in a sea of apparently arbitrary numbers, you’re not alone. That’s why it’s important to understand the FICO® Score and how it works.

If you want to understand the FICO® Score and how it affects your life, this article is for you. Here you’ll learn everything you want to know about FICO® Score, from what FICO® Score is used for, to the composition of the FICO® Score range, to the meaning of FICO®.

FICO® Score

If you’ve ever applied for a loan at a bank or most financial institutions, you probably came across the concept of a FICO® Score. But even though it’s a very common tool in traditional financial institutions, it’s just as common for people to get confused about it. The first thing you may find yourself asking is “what is FICO®?”.

A FICO® score is a credit score created by the Fair Isaac Corporation (FICO®) — and, yes, that’s what FICO® Score stands for. It’s one of the many ways to evaluate a borrower’s likelihood to repay a loan, but it’s the most used in the U.S. FICO® scores are used in more than 90% of the credit decisions made in the U.S, according to the company’s website.

How the FICO® Score is determined

To assess your FICO® Score, the company takes into consideration five factors and uses percentage to represent how important each one is for determining your credit score. The five factors are:

  • payment history: if you are making on-time payments on your accounts, it helps boost your credit score; if you are missing or delaying payments, it can take a toll on your score;
  • amounts owed: how much you owe, how many of your accounts have balances and the portion of your credit limit that you are using can impact your score;
  • length of credit history: the average age of your credit accounts, specially the age of the oldest and newest accounts;
  • credit mix: the types of accounts you’re managing, such as car loans, mortgage, personal loans, credit cards, credit lines, etc;
  • new credit: this takes into account if you recently applied for financial services or opened a new credit account.

Even though the percentages may vary according to each consumer’s particular history, FICO® considers the factors above proportionally when determining scores. Payment history makes up 35% of your FICO® Score, followed by amounts owed (30%), length of credit history (15%), credit mix (10%) and new credit (10%).

FICO® Score range

Just as important as knowing what goes into the FICO® Score assessment, it’s also important to understand what is the range for FICO scores. The resulting number ranges from 300 to 850. The FICO® Score ranking is generally divided as:

  • 300 to 579: Poor
  • 580 to 669: Fair
  • 670 to 739: Good
  • 740 to 799: Very Good
  • 800 to 850: Exceptional

A score above 670 is generally considered a good FICO® Score. But that number is not arbitrary: lenders may choose what range they consider good for a borrower depending on what types of clients they are looking for. Current events, such as an economic crisis, might also impact the lenders’ expectations of the borrower’s score.

Importance of FICO® Score

Now that you know what FICO® Score is and how your number is assessed, you might be asking yourself: “What is a FICO® score used for?”. If that’s the case, you’re not alone — it’s common to get lost among the many information and technicalities.


In short, FICO® Score, as any other credit score, is a number that shows your ability to honor your financial commitments. A credit score rank is a standard way to assess the borrower’s financial track record.

Your FICO® Score is a representation of your financial life: it aims to show your credit history in an accurate way. Because of this feature, lenders use the FICO® Score as a risk assessment tool to evaluate approval of loans and other financial services. 

It’s used mainly by banks and other traditional financial institutions. If you are planning on applying for a loan at said institutions, it’s important to have a good FICO® Score in order to get approval.

What if I have a bad FICO® Score?

Your FICO® Score is one of the many ways a lender can assess your ability to repay a loan. But it’s not an “end all, be all” way to understand who you are and your ability to honor your financial obligations. 

There are other ways to paint an even more accurate picture of your financial life. At OneBlinc we use our own risk assessment algorithm and alternative data to make our own credit decisions that give us a sharper picture of your financial history and your ability to repay a loan. 

Life happens and anyone can find themselves in a not-so-great financial situation. If you don’t feel confident relying on your FICO® Score to get a loan or other financial services, we have options for you at OneBlinc. Our team of experts have the proven record to help you find the best option for your financial needs.

About us

Unexpected things happen more often than we would like them to. That’s why OneBlinc is here to help, whether you have an emergency or just need that extra cash to go through the end of the month. We believe in people, and we understand that everyone might need money someday, somehow.