The Fair Isaac and Company score, otherwise known as the FICO score rating, is the most widely used barometer of credit. It can be a blessing or a curse for consumers, depending on who you consult. The FICO score estimator formula arrives at a three-digit number that tells the creditworthiness of a consumer based on several factors, including payment history and the ratio of debt to available credit. The FICO score rating is available through most major consumer reporting agencies.

While Fair Isaac maintains that most people score between 300 and 850 on a FICO score range, the number is a bit of a mystery in terms of average scores and score availability, as well as which version of the FICO score is used. We're in luck that there are plenty of online sources ready to lend some good advice and ratings on FICO scores.

To find out more about FICO scores, consider the following.

1. Learn as much as you can about how your financial decisions affect your FICO score.

2. Know which version of FICO is used to rate to understand factors that impact your score.

3. Understand how FICO compares to other credit numbers.

Action Steps
The best contacts and resources to help you get it done

Seek to understand FICO scores and how they're used

It may be frustrating for consumers to understand how their financial decisions affect their credit report and their credit score. For example, canceling a credit card may intuitively seem like a good way to improve credit, but it can actually negatively affect your FICO score. Luckily, there's a lot of good information that helps clear up misconceptions about FICO scores and how they are used.

I recommend: Myths About Credit Scores is a 60-second video provided by Next Advisor that helps shed some light on FICO scores. My Privacy Rights provides an in-depth discussion about FICO scores and how they are determined.

Get up-to-date information on the FICO score

The FICO Score has been periodically upgraded over the years by the Fair Isaac Company in an effort to provide a clearer picture of a person's creditworthiness. When understanding the number, it's important to know which version of FICO credit score the creditor is using to rate you.

I recommend: Spend on Life discusses the different incarnations of the FICO score over the years. Credit Scoring has a little fun with FICO scores in an attempt to show how information about the score range varies widely.

Learn ways to monitor FICO scores and repair credit

The FICO score, contrary to popular belief, is usually not free. The FACT Act, which required access to credit scores, does not apply to the FICO score, for which consumers have to pay a range of $6-$16 for access to their score.

I recommend: CNN Money explains how the FICO score is not free and also discusses the confusion created by other knock-off credit scoring numbers (affectionately called FAKOs by the industry) such as the PLUS score. They also mention the best place to get a credit score. Credit Score Cowboy gives a nice overview of how to monitor FICO credit scores.

Just as you have a personal credit score, your business has a business credit score. In fact, your business score is influenced by your personal score — and, like the personal score, helps determine loan approvals and interest rates.

The basic credit score is called a FICO score. The formula includes such information as punctuality of payment, debt capacity in use, length of credit history and types of credit used. To get your business into the best possible position, you'll need to do three things:

1. Improve the balance-to-limit ratio on outstanding credit cards and loans. Besides paying down balances, this may involve signing up for more credit — having a low balance compared to the available limit can improve a credit score.
2. Verify the accuracy of your credit information. This includes making sure that credit agency records show that any previous bad debts have been cleaned up.
3. Fix inaccuracies in your credit reports.

Action Steps
The best contacts and resources to help you get it done

Separate your business score from your personal score

An Employer Identification Number, also called an EIN or taxpayer ID number, helps to separate your business score from your personal score, which is attached to your Social Security number. Continue separating your business and personal identities by establishing separate phone numbers and checking accounts.

I recommend: Apply online for an EIN at the Internal Revenue Service Web site. Review the instructions and the form before starting.

Get your personal credit report

Lenders recognize a correlation between a business owner's personal credit history and likelihood of repaying a business loan — so be sure to check that your personal credit report is accurate. Reports may vary among reporting agencies, because each bases its score on slightly different criteria.

I recommend: Obtain a personal credit report, though not your credit score, for free once a year from each of the three major reporting agencies: Equifax, Experian and TransUnion. All three agencies also support a Web site from which you can order free copies of your reports: AnnualCreditReport.com. Buy a copy of your personal FICO score anytime at MyFico.com.

Review your business credit report

Small businesses do not have FICO scores, but lenders do consider other predictors that businesses will repay loans. So you'll want to be sure your business credit report is up to snuff.

I recommend: Order basic and comprehensive business credit reports at D&B Small Business Solutions. The Small Business Scoring Service at Fair Isaac includes a FICO score analysis, financial snapshot of your business, overall performance analysis and a score highlighting a company's payment performance.

Fix your credit to boost your score

You can correct inaccuracies and take steps to raise your score yourself, but if you prefer, you can hire help.

I recommend: Lexington Law Firm offers to delete inaccurate, misleading and unverifiable information on credit reports. BrightScore from the nonprofit credit counseling agency InCharge Institute of America Inc. provides credit analyses and score improvement plans.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  Your FICO score is based on your credit information and doesn't consider your employment, income or other personal data.
• •  If an application for credit is denied as a result of the credit score, you're legally entitled to specific reasons for the denial.
• •  FICO scores range from about 300 to 850, with scores over about 700 considered to be good credit.