The scoring system

Each time a consumer applies for credit, the prospective lender is going to want to find out how much risk they'd be assuming if they decided to loan money to the consumer.

FICO scores are issued to each consumer. Each individual has three FICO scores, one from each of the credit bureaus (Experian, TransUnion and Equifax) based on the data the credit bureaus have compiled and placed in your file. The scores fluctuate as this information changes.

In all three cases, the higher the number, the lower a credit risk the person is viewed. With that said, however, there is no one single "cutoff number" that makes someone a better or worse risk – and each lender has his or own set of things they're looking for. Also keep in mind that a lender may create its own score, with the FICO score being one of the things factored into their final number.