For years, credit score has been a major factor in determining loan qualification and interest rates. While there are a variety of credit scores out there, FICO credit score is used by most lenders to assess a borrower’s ability to repay. But for how long?
A growing number of lenders think that a person’s FICO score doesn’t tell the whole story, and can even be misleading under certain circumstances. It’s become clear that there are more accurate ways to measure financial wherewithal – no FICO score required.
Here is an interesting piece on this topic from San Francisco-based SoFi, a company that has chosen to not use FICO scores when evaluating applicants.