Seelinger Law understands that people suffer financial hardships for a variety of reasons, and we find the solutions that best fit your needs by listening to you and discussing your options in regards to many different determinations such as, understanding FICO and why it’s so important. We help our clients determine whether a chapter 7 or a chapter 13 bankruptcy is right for you and what is going to happening with your FICO score, and what that means to you.

What You Need To Know About FICO and Why It Is So Important

The Company FICO, Fair Isaac Corporation, takes information from the three credit reporting agencies and analyzes it to create a score that represents to lenders how likely someone is to pay back additional credit. FICO is not the only company which analyzes credit data to generate uniform scores but it is the most common; therefore, many people refer to ‘credit score’ and ‘FICO score’ as one in the same.

If debt collectors constantly call you multiple times a day: at work, home, and they even call family members, yet you have friends who are behind on their bills yet they do not get any of the phone calls; it doesn’t just seem like creditors are targeting you, they are targeting you. Debt collectors may target those who they have calculated to be less likely to pay back the debt according to a variety of factors.

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calculating debt

FICO’s Score Chart

The following are aspects that FICO takes into consideration when developing credit scores:

  • Payment history (35%)
  • Debt/Amounts owed (30%)
  • Age of credit history (15%)
  • New credit/inquiries (10%)
  • Mix of accounts/types of credit (10%)

Both creditors and consumers are able to access FICO scores. FICO scores range from 300 to 850 with a higher number representing less risk to lenders and a lower number representing more risk to lenders. Creditors characterize a FICO score of 650-699 as moderate and 700 and above as a good-to-excellent score. Potential buyers with a higher FICO score will have an easier time getting credit and will have better terms and conditions on the money borrowed.

The following are other things that FICO analyzes to determine your likelihood of paying back debts:

  • Does this person pay on time?
  • How much does this person owe?
  • How long has this person had a credit history?
  • To what extent has this person taken out new credit and what happened with it?

FICO does NOT analyze or take into consideration:

  • Gender
  • Race
  • Age
  • Marital status
  • Where this person lives in the world
  • The person’s assets
  • The person’s income

Large collection companies pay FICO to perform analytics to address three main concerns:

  1. Pinpointing which accounts to focus on to increase collection rates and lower losses. Collection agencies, like all companies, have to choose how to use their limited resources to maximize results. They have a large number of delinquent accounts to pursue and only a limited number of cubicles filled with people or machines equipped to make the calls.
  2. Minimizing the impact on good customers. Collection agencies do not want to pester and upset people who are inclined to pay on their own. Bothering these people could have a negative impact on future relations.
  3. Gaining an edge over competitors collecting on the same delinquent accounts. Collection agencies know that there are multiple agencies looking to collect from the same debtor. They are looking for ways to beat the competition to any possible payout.
fico score

FICO Stands by its Collection Score Product

FICO claims that its collection score product has the following benefits:

  • Increase collections by 20%
  • Reduce roll-rates
  • Minimize charge-offs
  • Improve customer services by using preventative measures to stop upsetting “best” customers with too many collection calls.

Although FICO promotes the benefits of the FICO collection score vigorously, FICO does not share any details with the public regarding how it configures the score or details about the range of the score. In fact, the public is not able to access their own collection score. Remember that only people who have accounts in delinquent status will even be assessed a FICO collection score.

fico stands by its product
stressing over debt collectors calls

Why Else May Creditors be Contacting Me?

Another reason that you may be experiencing an increase in harassing calls is if you have recently paid a delinquent account. The credit reporting agencies of Experian, Equifax, and Transunion, offer services whereby they inform collection agencies if a client has recently paid an old debt. Collection agencies interpret this action to mean that the client has come into new money and has a desire to settle old delinquent debts. This may result in an influx of debt collection phone calls. At Seelinger Law, we believe that you should find out your options.

Contact Seelinger Law today for a free consultation

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5148 Peach Street, Suite 330
Erie, PA 16509


Parkside Commons
847 N. Main Street, Suite 003B
Meadville, PA 16335


322 N. Shore Drive
Building 1B, Suite 200
Pittsburgh, PA 15212

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