Posted by Sean on May 02, 1999 at 11:35:04:
FICO Scores are created off of a person’s credit profiles when run through a computer algorithm created by Fair Isaac COmpany (“FICO”). The algorithm was created by examining about 750,000 people’s credit reports and comparing them with their credit reports 24 months earlier.
Approximately 45 different clues were determined to have been on people’s credit scores that indicated a statistically significant higher risk of a person failing to pay as agreed. A computer model was created so that these risks could be translated into scores.
A person who has a FICO score of 680+ will fail to pay as agreed within the next 24 months only one time out of 11. Accordingly your ratio of performing loans to non-performing loans will be about 10-1. A FICO score of 681 or more is considered to be quite good.
For more information contact http://www.fairisaac.com/