Q:  My credit score is 761, and my wife has a 764 FICO score.  We are trying to refinance and are wondering in these are good enough scores.

A: This is a tricky question, mostly because creditors use their own judgment as to what is a “good” score and what isn’t.  Your FICO score is calculated based on 5 factors:  payment history (35%), amount owed (30%), length of credit history (15%), new credit (10%), and types of credit used (10%).  Fair Issac basically puts all this information into their magic (and secret) algorithm blender and generates your FICO score.   Your FICO score (and everyone else’s) is included in the national distribution of FICO scores provided by Fair Issac.  Creditors draw their own conclusions from this data.

However, your FICO score isn’t the only factor they take into consideration.  Creditors also look things like your income, employment history and credit history.  Then based on all this information (and their own underwriting policies) they decide whether they will offer you credit and on what terms.  So if your combined income is $90,000/year, you’ve had a spotty employment history and you want to refinance a $1,000,000 loan, they may feel the credit risk is too high, regardless of your FICO score.  On top of this, sometimes regional factors come into play, so a suburban midwest creditor may perceive your information differently than an urban east cost creditor.

Of course, a FICO score that’s perceived as high should help.  Our advice is to do your research, approach several creditors for the refinance loan and see what they come back with.   And make sure you stay on top of your credit history and scores, because they are a moving target and fluctuate over time.  The easier (and least expensive) way to do this is to sign up with a credit report monitoring service like our top rated Identity Guard.