FICO (credit scoring model)

FICO is a credit scoring model used by lenders to assess how likely you are to repay a loan. It analyzes your credit history—such as payments, debts, and credit accounts—to generate a score between 300 and 850. A higher score indicates lower risk, making you more likely to qualify for favorable loan terms. The score helps lenders make informed decisions quickly, balancing your financial behavior with risk management. FICO scores are widely used because they provide a standardized way to evaluate creditworthiness based on your credit report.