FICO is a software company based in San Jose, California and founded by Bill Fair and Earl Isaac in 1956. Its FICO score, a measure of consumer credit risk, has become a fixture of consumer leading in the United States. The name FICO comes from the company's original name Fair Isaac Co. It was often shortened to FICO and finally became the company's official name several years ago.
To create credit scores, they use information provided by one of the three major credit reporting agencies - Equifax, Experian or Transunion. But FICO itsself is not a credit reporting agency. ALWAYS REMEMBER THIS FACT.
FICO is a company that specializes in what's known as "predictive analytics," Which means they take information and analyze it to predict what's likely to happen.
So basically FICO is an educated "Fortune Teller". There are millions of people that have done exactly like YOU in regards to credit. The FICO company has computed all the results and they have give you a score.
The FICO System assigns you a three-digit number that indicates your ability to pay back loans. FICO scores range from 300 to 850, and the national average FICO score is 695
Your credit score is akin to a school GPA. It's a number that measures your success to others,, in this care grading you as a credit-worthy individual.