Credit scores are going to be calculated differently. Here's what you need to know.

Posted at 9:56 AM, Jan 24, 2020
and last updated 2020-01-24 10:56:13-05

FICO scores are the most widely used credit scores in the U.S., and they're changing in a way that could make it harder for many to get loans.

They are created by the Fair Isaac Corporation, which is changing how the scores are calculated.

The company will use a stricter method for scoring people with rising levels of debt and consumers who get behind on loan payments.

Additionally, some who sign up for personal loans will be flagged.

Fair Isaac said the result will be a larger gap between people judged to be good credit risks and those deemed to be bad risks

Basically, good credit situations will get better, bad ones will get worse.

If your FICO score is above 680 and you keep managing your loans well, your score will go up more than it would have before.

If your score is under 600 and you keep missing payments - your will drop more dramatically than before.

However, one FICO executive says most consumers will only see a 20-point change in their score up or down.