For credit card issuers, FICO developed a type of industry-specific FICO Score called the FICO Bankcard Score 8. The score is based on the base FICO Score 8.
You may already be familiar with the FICO® Score☉ 8—the general-purpose base credit score. The FICO credit scoring company also creates many other versions of credit scores, including FICO Bankcard Scores.
The FICO Bankcard Score 8 is a type of credit score that uses a 250-to-900 range. Its often used by creditors when you apply for a credit card or a credit limit increase. What you should know about this credit score’s operation and how to raise your FICO Bankcard scores is provided below.
What is the FICO Score 8?
The FICO Score 8 is a credit score developed by the Fair Isaac Corporation (FICO) that is used by lenders to assess the creditworthiness of borrowers. It is a three-digit number that ranges from 300 to 850, with higher scores indicating a lower risk of default. The FICO Score 8 is the most widely used credit score in the United States, and it is used by over 90% of lenders.
How is the FICO Score 8 calculated?
The FICO Score 8 is calculated using a complex algorithm that takes into account five factors:
- Payment history (35%): This is the most important factor in your FICO Score 8. It measures how well you have paid your bills on time in the past.
- Amounts owed (30%): This factor measures how much debt you have compared to your available credit. It is important to keep your credit utilization ratio low, which is the amount of credit you are using compared to your total available credit.
- Length of credit history (15%): This factor measures how long you have been using credit. The longer your credit history, the better.
- Credit mix (10%): This factor measures the different types of credit you have, such as credit cards, installment loans, and mortgages. Having a mix of credit can help improve your score.
- New credit (10%): This factor measures how often you have applied for new credit. Opening too many new accounts in a short period of time can hurt your score.
What is the difference between the FICO Score 8 and other FICO Scores?
There are a number of different FICO Scores, including the FICO Score 9, FICO Score 10, and industry-specific scores such as the FICO Auto Score and FICO Bankcard Score. The FICO Score 8 is the most widely used score, but the other scores may be used by some lenders. The main difference between the FICO Score 8 and other FICO Scores is the data that is used to calculate the score. The FICO Score 8 is based on data from all three major credit bureaus (Experian, Equifax, and TransUnion), while other FICO Scores may only use data from one or two bureaus.
How can I improve my FICO Score 8?
There are a number of things you can do to improve your FICO Score 8, including:
- Pay your bills on time: This is the most important thing you can do to improve your score. Even one late payment can have a significant negative impact on your score.
- Keep your credit utilization ratio low: Aim to keep your credit utilization ratio below 30%. This means that you should only use a small percentage of your available credit.
- Don’t open too many new credit accounts: Opening too many new accounts in a short period of time can hurt your score.
- Become an authorized user on a credit card with good credit: This can help you build credit history without having to open a new account.
- Dispute any errors on your credit report: Errors on your credit report can hurt your score. You can dispute errors with the credit bureaus.
Why is the FICO Score 8 important?
Your FICO Score 8 is an important factor in your financial life. It can affect your ability to get a loan, the interest rate you pay on loans, and even your ability to get a job. A good FICO Score 8 can save you money on interest payments and help you qualify for better loan terms.
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The FICO Score 8 is an important credit score that can have a significant impact on your financial life. By understanding how the FICO Score 8 is calculated and how you can improve your score, you can take steps to improve your financial health.
What Is a FICO Bankcard Score 8?
The FICO Bankcard Score 8 is a FICO® Score designed especially to assist credit card issuers in determining the probability that a borrower will miss a credit card payment by 90 days or more during the course of the next 24 months.
The score has a wider scoring range—250 to 900—than the base FICO® Score range of 300 to 850. But industry-specific FICO® Scores are built on top of an underlying base FICO® Score. In this case, the FICO Bankcard Score 8 is built on the FICO® Score 8. Additionally, the FICO® Scores 9 and 10 serve as the foundation for the more recent FICO Bankcard Scores 9 and 10, respectively. There are older versions of both general-purpose and industry-specific scores as well.
This score may be used by the credit card issuer to evaluate your application, as well as to set your account’s credit limit and interest rate. However, card issuers and other creditors can choose which score they use.
How to Check Your FICO Bankcard Scores
While there are numerous ways to check your credit scores, you may be able to check one of your FICO Bankcard Scores by carefully examining the product offerings and occasionally the fine print.
Your FICO® Score 8 is based on your Experian report, and Experian provides a free credit report and score. Get a complimentary seven-day trial of CreditWorksSM Premium if you’d like to check more credit scores. Your FICO Bankcard 2 and FICO Bankcard 8 Scores, among other Experian FICO® Scores, are included in the subscription service, which offers daily updates.
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What is FICO score 8?
FICO Score 8 was launched in 2009. It’s one of FICO’s base credit scores, which means it isn’t designed for a certain type of credit. Like other base credit scores, the scores range from 300 to 850. And like FICO’s other base credit scores, Score 8 is intended to determine the likelihood that a borrower will pay back a loan.
How does FICO® score 8 differ from previous versions?
Though FICO didn’t reinvent the wheel with FICO® Score 8, it does differ from previous versions in several key ways. Isolated late payments matter less. FICO® Score 8 is a little more forgiving of a one-time late payment than previous versions. “Late” generally means at least 30 days after the due date. Multiple late payments matter more.
Do FICO score 8 credit scores matter?
That all depends on what you want to do. In general, if you’re trying to get a new credit card, car loan or consumer loan, then your FICO® Score 8 credit scores can matter. Since FICO® Score 8 credit scores are the most widely used FICO® scores, there’s a good chance a potential lender may use it.
What is the difference between FICO® score 9 & 8?
FICO® scoring versions differ from one another because each is based on a unique formula. Though FICO® Score 9 debuted in 2014, FICO® Score 8 is still widely used in lending decisions. It’s especially sensitive to high credit card utilization but is generally more forgiving of isolated late payments than previous versions.