Answer:
a. True
The statement is true. Over the last decades, the FICO score has indeed become a powerful tool for lenders to determine whether loans can be granted. The FICO score is a credit scoring system developed by the Fair Isaac Corporation (FICO) and is widely used by lenders to assess the creditworthiness of individuals or businesses applying for loans or credit.
FICO scores are calculated based on various factors, including payment history, credit utilization, length of credit history, types of credit used, and recent credit inquiries. Lenders use these scores to evaluate the credit risk associated with potential borrowers. Automated underwriting processes, often incorporating the FICO score, have become more prevalent in the lending industry, replacing more traditional approaches that involved manual evaluation of loan applications.
Automated underwriting systems utilize algorithms and predefined criteria to assess loan applications quickly and objectively. These systems can process large volumes of loan applications efficiently, reducing the time and resources required for manual evaluations. By relying on the FICO score and other relevant data, lenders can make more informed decisions about granting loans, streamlining the lending process and increasing overall efficiency.