A financial obligation arises when an individual, corporation, or even a government organization borrow funds for investment and expansion purposes. In this case, a creditworthiness assessment is the first step taken by financial institutions that are willing to provide funds. Creditworthiness determines the ability of the borrower to repay the amount taken in part or full.
Creditworthiness also determines the credit score, which is a numerical representation of the borrower’s credibility with respect to honoring a financial obligation. The Fair Isaac Corporation (FICO) is one of the premier credit-rating agencies in the country working in an individual capacity in line with Equifax, Experian, and TransUnion.
The agency is mainly responsible for determining a suitable credit score that will have a major impact on the amount of loan, interest rates, and favorable terms of repayment. Factors including the payment history, type of credit used, amount of debt, previous credit history, and credit accounts are taken into account by FICO for assessing credit.
FICO not only issues a suitable credit score for individuals but also helps businesses in making better decisions to support their growth and profitability. The organization makes use of big data analysis and mathematical algorithms in the assessment. Note that FICO issues credit scores for individuals while a credit rating is applicable for businesses and organizations. Credit score and credit rating may serve similar purposes but differ when it comes to their impact on the assessment.
Why FICO?
FICO manages to set an independent standard time when it comes to credit scores and rating. The key focus is on maintaining high data standards while adhering to sound business practices. These efforts translate into a good credit score for applicants that provide opportunities for growth and development.
A good credit score indicates a good credit history. FICO issues scores that are in the range of 300 to 850 with the higher number indicating an excellent credit score. Scores above 650 help applicants obtain credit from multiple options at favorable interest rates.
Sectors served by FICO
FICO offers credit scoring and rating services in the following sectors.
- Transportation
- Financial services
- Insurance
- Public sector
- Live sciences
- Education
- Retail
- Manufacturing
- Technology
- Utilities and telecom
How to view your free FICO score?
Although FICO is an individual authority when it comes to credit rating and scores, you can still view your free FICO score with all credit bureaus including Equifax, Experian, and TransUnion. While there are other institutions that also provide estimates for credit scores, they are not as accurate as FICO. Furthermore, banking institutions choose one of the three credit bureaus to calculate a FICO score that can differ accordingly.
FICO charges a standard fee of around $60 to see the scores with a full copy of the credit report. However, you can view your free FICO score in the following ways.
Discover Bank
The bank features a credit scorecard program for applicants to sign up online that also allows you to view your FICO score for free.
Credit card holders
Banking institutions who offer credit cards to their customers also allow them to view their current FICO score. Applicants with an excellent credit score will have a better chance of applying for a low-interest rate credit card. It is also one of the main reasons why credit card issuing authorities allow you to view your free FICO score.
Loan for automobile purchase
A credit score reflects the ability of the borrower to make repayments on time. It is also one of the factors that will affect the amount, interest rate applicable, and repayment terms on your borrowings. Financial institutions that issue certain types of automobile loans also allow you to check your credit score and rating. You can log into their official website and view your free FICO score.
Credit unions
There are a few select credit unions who provide free access to information with respect to your credit score. They include North Carolina State Employees’ Credit Union, Digital Federal Credit Union, and Pennsylvania State Employees Credit Union.
Applicable student loans
Banking and non-banking financial institutions that issue different types of loans for educational purposes allow their applicants to view their FICO scores.
Nonprofit organizations
The National Foundation for Credit Counselling is one of the alternative sources to view your free FICO score. Credit scores and ratings enable these credit counseling agencies and help provide financial solutions to their clients.
Alternative ways to check your FICO score for free
- Citibank, DCU Credit Union Huntington Bank, and PenFed offer credit cards and lines of credit that also allow you to check your free FICO score with Equifax.
- American Express, Chase, Discover, First National Bank of Omaha, and Wells Fargo issue similar credit cards that also allow you to check your free FICO score specifically with Experian.
- Bank of America and Barclays offer credit cards that allow you to check your FICO score in association with TransUnion credit rating services
