FICO Scores

Statistical Analysis
Mortgage and credit card lenders, employers, insurance companies, landlords, and
others use FICO scores developed by the !rm Fair, Isaac & Co. Credit scores are
compiled using statistical analysis of ones credit history. FICO credit scores range from
300 to 850.

Important Elements
FICO credit scores are now generally revealed with a persons credit report from the
three main credit reporting agencies. The !ve major components in a credit report and
the relative weight of each include:
Past Payment Performance (35%)
Amount of Debt (30%)
Length of Credit History (15%)
New Credit (10%)
Types of Credit (10%)

Change in Score
Credit scores can drop very quickly if the maximum amount is charged on credit cards
or even just a few bills are paid late.

Credit Scores & Interest Rates

The higher the credit score, the less an individual can expect to pay in interest on a loan.
For example, on a $300,000 30-year, !xed-rate mortgage:
FICO Score Interest Rate* Monthly Payment
760-850

3.301%

$1,314

700-759

3.523%

$1,351

680-699

3.7%

$1,381

660-679

3.914%

$1,417

640-659

4.344%

$1,492

620-639

4.89%

$1,590

SOURCE: MYFICO.COM.

* Interest rates stated here are for illustration purposes only. Rates change daily, but the
relationship between credit scores and interest rates remains the same.

2016 Financial Knowledge Network, LLC.