As described above, FICO developed the first credit scores in the 1950s, and the FICO scores are still the most widely used generic scoring models. One industry observer estimates that FICO had
over 90 percent of the market share in 2010 of scores sold to firms for use in credit-related decisions.
There are numerous FICO scoring models. Because of differences in the data at the three CRAs, FICO develops unique generic scoring models for use at each of the three CRAs.12 There are also several different generations of generic FICO scores in use, and FICO develops industry models for credit cards, mortgages, and auto loans.
All scoring models FICO creates are built to generate scores that fall in the range 300 to 850. Different FICO scoring models, however, may produce minimum or maximum scores slightly
above 300 or slightly below 850.
Fannie Mae and Freddie Mac, the government-sponsored enterprises that purchase and securitize a large portion of mortgages for the secondary mortgage market, require the use of FICO scores in the underwriting of mortgages that they will purchase.13 The Federal Housing Administration (FHA) has also required that mortgage lenders wishing to originate FHA-insured loans must use FICO scores.14 These requirements mean that, in the current mortgage market, most mortgages are
underwritten using FICO scores.