Whenever
you
are
applying
to
obtain
credit,
to
purchase
a
car,
a
new
credit
card,
get
a
student
loan
or
purchase/refinance
a
home,
you
will
be
asked
to
provide
a
social
security
number.
This
is
the
key
to
your
credit
report.
There
have
been
many
methods
over
the
years
to
determine
your
credit
Nobility,
that
is
your
willingness-to-pay
debts
in
a
timely
manor.
This
is
the
risk
a
credit
provider
is
taking
with
you
to
repay.
In
the
early,
1900’s
there
was
the
local
banker
that
knew
the
credit
requestor
family
and
made
the
determination.
Today
there
has
been
a
progression
to
non-bias
software
scoring
models.
The
credit
scoring
system
that
has
become
most
popular
though
the
years
is
called
(FICO).
This
software
system
produces
a
scoring
guide
number.
The
scoring
guide
number
is
a
statistical
approach
to
assessing
the
risk
of
an
individual
to
pay
back
a
loan.
Mathematical
models
have
been
generated
to
provide
a
consistent,
fair,
equitable
and
repeatable
number.
Credit
scoring
is
statistically
extending
credit
to
borrowers
utilizing
a
software
program
devised
by
two
programmers
in
the
late
1950’s
in
San
Rafael,
CA
and
have
been
continually
upgraded
to
where
it
is
the
most
widely
used
statistical
analysis,
non-biased
tool
for
the
credit
providing
community.
The
company
became
Fair,
Isaac
and
Company
(FICO),
named
after
it’s
two
founders.
Your
FICO
score
was
all
hush-hush
until
the
mid
1990’s.
Under
pressure
from
the
state
and
federal
governments,
you
can
now
get
your
FICO
score
from
your
loan
officer
or
the
credit
reporting
repositories.
The
Fair,
Isaac
and
Company
FICO
scoring
system
has
become
one
of
the
most
popular
software
models
used
by
the
financial
community
today.
You
are
highly
recommended
to
Obtain
a
Credit
Report
3-6
months
before
you
want
to
obtain
a
mortgage
loan.
This
will
provide
some
time
to
correct
credit
report
errors.
Review
the
section
on
How
to
Correct
Report
Errors
and
take
appropriate
action.
The
FICO
scoring
system
evaluates
the
following
items
as
part
of
its
algorithm,
so
for
review
be
honest
with
yourself.
Remember,
80%
of
people
have
very
good
credit.
Past
delinquencies-
7
year
with
more
weight
past
2
years,
30-60-90
days
late
Derogatory
payment
history-
is
there
a
pattern
of
late
payments:
0-24,
25-48
and
49-99
months
buckets
Current
level
of
indebtedness-
number
of
open
credit
lines
and
%
of
open
credit
balance
on
each
Length
of
credit
history-
time
period
on
each
credit
line:
0-24,
25-48
and
49-99
months
buckets
Types
of
credit:
loan-
credit
card
or
mortgage
How
often
is
credit
applied
for-
during
past
7
year
with
more
weight
past
2
years
Number
of
credit
inquiries-
during
past
2
years
with
more
weight
during
past
3
months
Public
Records-
tax
liens,
judgments,
bankruptcies
and
delinquent
school
loans
