Last week I posted about a leaked Fico document containing a list of all the Fico reason codes. I promised to analyze the document and report back to my readers about the insights we can gain from it about the Fico scoring model. Before I do that, I would like to first let you know this important point.

The Fico Scoring Model Is Confidential

The reason why Fico provides the reason codes is not in order to help a consumer understand their credit score. Fico provides it because the law requires them to do so. Credit reason codes are like the ingredients found in the back of a Coca-Cola bottle. Coca-Cola does not reveal to you the recipe of how to make coke, nor will the ingredients help you in any way figure out how to make coke. The ingredients are there only for legal reasons. (Some people believe that Coca Cola even adds some fake ingredients in order to confuse you!) The same is true about the reason codes. The reason codes do not in any way reveal to you how Fico calculates credit scores. It is just there to teach you a thing or two about the factors Fico may (or may not) use to determine your Fico score.

Next week, I will go through with you some major surprising things that we can find in the leaked document. I want you to keep in mind, that all the information found in that document needs to be taken with a grain of salt. I personally would not predict that Fico had written this document in order to educate consumers about the Fico scoring model. I would rather predict the opposite.

That’s it for now, see you next week!

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