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MAY 16, 2000

A Sample Credit Scoring Model

Here are some factors that might go into a typical credit score. The higher the final score, the better your chances of approval. Note that the actual criteria and the weightings vary from model to model and lender to lender

Characteristics Attributes with Hypothetical Weights
Credit History of Principal(s) Data:
Consumer Credit Report
Major Derog (bankruptcy, collections) -40 pts. Minor Derog (minor delinquencies) -10 pts. Satisfactory 15 pts. No Record 0 pts.
Unused Credit Data: Consumer Credit Report >75% of Available 40 pts 74%-33% of Available 30 pts <33% of Available 20 pts No Record 0 pts
Credit History of Business Data:
Credit Report
Major Derog -40 pts Minor Derog -10 pts Satisfactory 15 pts No Record 0 pts
Industry Type Data: Federal 
SIC Code
Group A (manufacturing, with hard assets) 50 pts Group B 40 pts Group C 35 pts Group D (high risk, e.g. restaurant) 20 pts
Available Liquid Assets of Business
(e.g. bank balances) Data: Loan Application
<$6K 15 pts $6-$19K 20 pts $20-$49K 40 pts $50K & up 45 pts
Net Worth of Principal(s) Data: Loan Application <$50K 10 pts $50-$100K 20 pts $100-$250K 30 pts $250K & up 40 pts

DATA: Fair Isaac Inc. and Business Week


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