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Credit Card Applications » News » Other » The FICO Simulator Explains the Ups and Downs of Credit Scores

The FICO Simulator Explains the Ups and Downs of Credit Scores

Did you ever wonder if that bill your forgot to pay would result in your credit score taking a dip? Or wondered how your financial planning affects your score? If so, you don’t have to wonder any longer. FICO has rolled out their new Score Simulator, which gives people a look at what goes into lowering or increasing their credit score.

Most lending decisions are made by looking at these scores so it’s good information to have, and the new simulator gives people more information on what goes into creating their score.

“Because FICO Scores are used in more than 90 percent of U.S. lending decisions, consumers want to better understand how their actions might affect FICO Scores,” said Geoff Smith, vice president, Consumer Scores, at FICO.

“The newly enhanced FICO Score simulator enables consumers to run simulations using the actual FICO Score 8 formula as well as data from all major credit bureaus. This is an extremely easy-to-use and valuable tool for anyone who wants to understand how their financial behavior could impact their FICO Scores.”

What it looks like

The FICO Score Simulator can be found on the FICO website, offering comparisons, which are actually based on information obtained from the three major credit reporting agencies.

The new simulator lets people get a grasp of how their actions affect their score by offering side-by-side comparisons. This way they can see how several actions will affect their score, not just a single one, whether that is paying off a credit card balance, missing a payment or getting a bump in their credit limit – or all of them.

They have added half a dozen new simulations to their list of scenarios so people have more options to choose from, and will be able to run scenarios using two dozen different kinds of actions. The database includes:

• Forgetting to pay a bill
• Paying down a credit card balance
• Refinancing a mortgage
• Taking out a car loan
• Maxing out credit cards
• Increasing the limit on a credit account

When the scenario is run, people will get contextual information along with explanations so they can get a better understanding of how credit scores work.

Disclaimer: This editorial content is not provided or commissioned by the credit card issuer(s). Opinions expressed here are the author's alone, not those of the credit card issuer(s), and have not been reviewed, approved or otherwise endorsed by the credit card issuer(s). Reasonable efforts are made to present accurate information, however all information is presented without warranty. Consult a card's issuing bank for the terms & conditions.
All rates and fees, and other terms and conditions of the products mentioned in this article/post are actual as of the last update date but are subject to change. See the current products' Terms & Conditions on the issuing banks' websites.
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