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What Does FICO Stand For?

5 min read

Last Updated: July 18, 2025

Table of contents

Key Takeaways

FICO stands for the Fair Isaac Corporation.
Your FICO^® Score is calculated based on the information in your credit report.
You may find it easier to get credit approval if you have a higher credit score.

According to the Consumer Financial Protection Bureau, your credit score serves as a predictor of your future credit behavior. It looks at how likely you are to pay back a loan based on the information in your credit report.

There are different credit scoring models, but the FICO^® Score is the most widely recognized model. When you understand what FICO is and how the scoring model can impact your finances, it can help empower you the next time you apply for credit.

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What does FICO stand for?

FICO is an acronym for the Fair Isaac Corporation. FICO developed a credit scoring system that lenders can use to check a potential borrower’s creditworthiness. FICO is not a credit reporting agency. Rather, FICO uses information from the three major credit bureaus (Equifax^®, Experian^®, and TransUnion^®) to help calculate your credit score.

You may also have more than one FICO^® Credit Score. Your lender may use an industry-specific FICO^® Score related to the type of loan you’re getting.

For example, there are FICO^® Auto Score and FICO^® Bankcard Score for auto loans and credit cards, respectively. So, the FICO^® Score a car dealership uses may be different from the FICO^® Score that a mortgage lender may use.

According to FICO, the most widely used FICO^® Score version is the FICO^® Score 8.

Why is a FICO® Score important?

FICO^® Credit Scores help lenders determine if you’re reliable enough to loan money to. Lenders use this information when granting credit, setting interest rates, and determining credit limits. Most FICO scoring models range from 300 to 850, with higher scores representing better credit.

Your FICO^® Scores are important because, in general, a higher FICO^® Score shows lower credit risk. So, if you have a high credit score, you may find it easier to get loans, mortgages, and credit cards at better interest rates.

Landlords may use the information in your credit history to determine your financial responsibility, too.

How is your FICO® Credit Score calculated?

FICO calculates your credit score using the following five score categories:

Payment History (35%): Your payment history looks at whether you’ve paid your past credit accounts on time. Late payments or missed payments may have an impact on your credit score. You should always try to make your credit card payments on time.

Amounts Owed (30%): Your amounts owed looks at your credit utilization ratio—that is, how much credit you’re currently using versus the amount of available credit you have. In general, you want to keep your credit utilization low.

Length of Credit History (15%): Lenders like to look at how long you’ve had credit. The more credit history you have, the more info lenders have to figure out your creditworthiness. This factor considers the age of your oldest and newest accounts, as well as the average age of all your accounts. But, even if you have low or no credit, you can start to build a credit history¹ with a secured credit card.

New Credit (10%): Credit providers also want to look at how often you’ve applied for credit. If you open several new credit accounts in a short period of time, it may raise concerns about how well you’re managing credit and can impact your credit score.

Credit Mix (10%): Credit mix looks at the different types of credit accounts you have, such as credit cards, loans, and mortgages. Your credit mix shows your ability to manage different types of credit responsibly.

What is a good FICO® Score?

While each lender determines what they consider to be a good FICO^® Score, the following table provides a general descriptor by score ranges:

<580	Poor
580-669	Fair
670-739	Good
740-799	Very Good
800+	Exceptional

If you have a good credit score or better, you may have an easier time getting approved for credit offers than if you have a fair or poor score. But what’s considered a good credit score will largely depend on the lender. Credit providers factor in more than just your credit score when you apply for an offer. Other factors like certain items on your credit report and your income can also matter.

Where can I get a FICO® Score for free?

If you’re a Discover Cardmember, you can get your free FICO Credit Score and more for free. It's free and checking your score doesn’t hurt your credit.²

The FICO^® Score Discover provides is based on the information in your TransUnion^® credit report at a specific time in your credit history. As the information on your credit file changes, your score may also change.

How can I get a good FICO® Score?

You should practice good credit management habits like paying bills on time, keeping your credit usage low, and only opening new credit accounts sparingly. These good credit habits may have a positive effect on your FICO^® Score. Similarly, too many hard inquiries, delinquent payments, and past due accounts may impact your score.

The bottom line

The Fair Isaac Corporation, known as FICO, is the developer of the FICO^® Score, a popular credit scoring model. When a credit bureau tells you your credit score, there’s a good chance they used this scoring model to determine your score.

Creditors often look at credit scores calculated using this model when you apply to open an account with them. Potential lenders make a hard inquiry on your credit report to see your score, payment history, recent late payments, and other factors. This helps them make a lending decision, and having a good credit rating can help you get better terms and interest rate.

There are industry-specific FICO^® Scores, too. An auto lender might request a different FICO^® Score than a mortgage lender, for example.

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