As a Real Estate expert, I know how important credit scores have become over the years.  For better or worse, a credit decision now usually rests on what is supposed to be an objection and unemotional number. That number is FICO credit score. So, know what it is and how to improve it can save you a lot of money.

 Knowing your FICO credit score before applying for a loan will save you time and money.  With the mortgage industry rapidly changing on a daily basis it is important to have all your finances in order.  The new FICO formula, factors in financial information that could raise or lower your credit score.  Banks, mortgage lenders, government agencies, retailers, insurance companies and credit card companies use the Fair Isaac guide lines (FICO credit score) in analyzing credit and loan requests.  The following information was compiled by my.FICO.com, a division of Fair Isaac Corporation. 

What is a FICO Credit Score

When you apply for a loan or credit card, lenders determine what type of risk they are taking when loaning you money.  The majority of lenders use FICO credit scores to evaluate how much of credit risk you may be.  They normally will pull three credit bureaus.  The bureaus they use are Trans Union, Esperian and Equifax.  Each company produces a FICO score that is based on the credit information it has compiled in your file.  Over time, as the information changes, your FICO score will adjust as well.  Your three FICO scores will determine the amount a lender will loan you, what the interest rate is and what the term of the loan will be.  The better the FICO credit scores, the better rates, term and dollar amount you will receive from a lender.