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Fair Isaac moves to new credit rating formula

Fair Isaac Corp., the Minneapolis firm responsible for determining your FICO credit score, switched Thursday to a “new and supposedly improved” formula for setting scores, Marketplace reports.The formula changes have been in the wor

Fair Isaac Corp., the Minneapolis firm responsible for determining your FICO credit score, switched Thursday to a “new and supposedly improved” formula for setting scores, Marketplace reports.

The formula changes have been in the works for three years, so they predate the credit crisis. The new method is intended to better differentiate people who mistakenly miss a single payment from those who are routinely late.

A spokesman tells Marketplace that consumers will notice little change to their credit score, and they should keep paying their bills on time and keep credit card balances low.