There is a number called credit score which is chosen somewhere between 300 and 850, and which describes a person’s ability to pay his or her bills. This number is chosen according to a person’s credit files. So the number is the result of three major credit reporting agencies. So when a person is interested in lending some money from a bank or agency these ones will use these scores in order to check that lender’s ability to pay his or her bills and which entitles them to reduce the eventual losses caused by bad debts.

Also, these scores allow the lenders to determine the interest rate and the credit limits. Such a use of the score before being granted the credit is part of a secure system. It is well known that the most known score in the USA is FICO (more often used in the mortgage industry), though there are also others, namely NextGen and VantageScore.

Though we know it as FICO this stands for Fair Isaac Corporation. This credit score is the model known as the most popular throughout United States. The score is obtained after having applied the statistical methods that sir Fair Isaac had developed, to the information in one's credit file. The consumer banking and credit industry are the first to use the FICO score. Other institutions such as banks use these scores as one of the factors that determine the final lending decision. People are granted or denied a credit based on this score. The score establishes a higher interest to be applied or it can ask for the applicant’s income to be a higher one but also assets closer examination in case the applicant's credit score is low.