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What Is a FICO Score?

Your FICO score can have a large impact on your finances -- and vice versa.

A young woman is on her phone while holding her credit card in her right hand.
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Your credit score can come in several different forms depending on how it's calculated. Lenders use different types of scores to evaluate different aspects of your credit history. Two of the most commonly used credit scores are your VantageScore and your FICO score.

What is a FICO score?

A FICO score is a three-digit number used by lenders to evaluate creditworthiness. It's designed to be a simple, unbiased representation of your credit history and ability to repay loans. Your score is based on five factors: payment history, amounts owed, length of credit history, new credit and credit mix. But there's no one-size-fits-all model when it comes to credit scores and your credit report. Whether lenders check your FICO score or VantageScore, a good credit score can help you secure the best rates on your credit cards, loans and insurance.

FICO scores range from 300 to 850 and help lenders evaluate risk in prospective borrowers. It measures how long you've had credit, if you've paid on time, how much credit is being used and so on. Your FICO score is only one part of a lender's decision, and not all lenders use FICO scores. But approximately 90% of top lenders in the US use them.

What is the FICO score range?

The FICO score range is broken up into five categories:

300-579: Poor
A score under 580 is considered below average and ruled as a risk by potential lenders. 

580-669: Fair
Still considered below average. People with a Fair FICO score may be approved by lenders, but without favorable terms. 

670-739: Good 
FICO scores between 670 and 739 align with the national average (714), and most lenders are willing to lend to borrowers in this category. 

740-799: Very Good
Anyone with a Very Good FICO score is assessed as low risk and above average. 

800-850: Exceptional
Exceptional FICO scores are the most likely to get approved, but they also have access to the best rates and loan terms. 

How is a FICO score determined?

A FICO score is calculated by pulling data from the three credit bureaus: Equifax, TransUnion and Experian. It's based on the following factors:

  • Payment history (35%): Payment History is the most influential factor and examines whether or not a person pays their bills on time. 
  • Amounts owed (30%): Amounts Owed are based on the ratio of your total credit to your total debt -- also known as credit utilization -- and they're the second most important factor. 
  • Length of credit history (15%): How long you've had credit affects the way your credit score is calculated. This is calculated by considering the ages of the oldest (and newest accounts) and the average age of all your accounts. 
  • Credit mix (10%): Having a variety of credit accounts helps lenders examine whether or not you can handle different types of accounts. While this only accounts for 10% of a FICO score, having both installment loans and revolving credit can help your score. 
  • New credit (10%): New Credit evaluates the quantity of recently opened credit accounts and the number of hard inquiries from creditors when applying for credit. 

How can I improve my FICO score?

Improving your FICO score takes time, but it is possible with the right moves, including the following:

  • Pay your bills on time, every time.
  • Track your credit score with a monitoring service
  • Correct any mistakes found in your credit report. All credit bureaus have a dispute resolution process that can help you resolve data that's not accurate.
  • Decrease credit utilization by keeping your balances low on revolving lines of credit, like credit cards.
  • Address any missed payments to date. 
  • Pay down debt by making more than the minimum monthly payment.
  • Refrain from closing your oldest credit card accounts, but keep them in good standing. 
  • If you are an authorized user on someone else's account, make sure that data is being reported to the credit bureaus. 

The bottom line

A FICO Score is an essential tool for understanding your creditworthiness and can be a key factor in lenders' decisions on loan offers, interest rates and other financial opportunities. A good FICO Score can help you save money and secure the best rates. Still, to maintain a good credit score, you must prioritize on-time payments, low credit utilization and paying down existing debts. 

The editorial content on this page is based solely on objective, independent assessments by our writers and is not influenced by advertising or partnerships. It has not been provided or commissioned by any third party. However, we may receive compensation when you click on links to products or services offered by our partners.

Correction, 7:30 a.m. PT Jan. 25: A previous version of this article stated that the VantageScore credit score uses a range of 501 to 990. Previous versions of VantageScore used that range, but it was later changed to a range of 300 to 850. That section of the article has been removed.