Is a VantageScore better than a FICO Score? Can you influence which of your credit scores lenders consider? Although you may have dozens of different credit scores, no one score is “better than” another. The best type of credit score is one that qualifies you as a good credit risk or better based on the specific credit scoring model that’s used. Keep reading to learn more about the various credit scoring models.
Credit Scoring Models
A credit scoring model is an algorithm that uses data in your credit report to calculate a credit score reflecting how responsibly you manage credit. Lenders and other creditors use credit scores when evaluating your applications for credit, such as loans or credit cards.
Types of Credit Scoring Models
The two primary credit scoring models are the FICO® Score and the VantageScore. The two models work a little differently, and each of them has multiple versions. Here’s a closer look at how the FICO Score and VantageScore credit scoring models work.
The FICO Score was created by Fair Isaac Corporation in 1989, and several versions of this model have been released over the years. Just as with any computer software, new versions are released to take advantage of new trends and create a more accurate credit score.
FICO® Score Versions
There are generic versions of the FICO Score designed to be used by many industries. Currently, the version most lenders use is FICO Score 8, launched in 2004. There are newer versions—FICO Score 9, released in 2004, and FICO Score 10 and 10 T, released in 2020—but switching to a new version can be costly and time-consuming for lenders, so it generally takes a while for them to catch up.
In addition to the generic or “base” FICO Scores, FICO creates a variety of scores designed for specific industries, such as the FICO Auto Score and FICO Bankcard Score. Each of these industry-specific scores has multiple versions, too.
FICO® Score Factors
The base FICO® Score considers scoring factors in the following order:
- Payment history: 35%
- Amounts owed: 30%
- Length of credit history: 15%
- Credit mix: 10%
- New credit: 10%
The FICO Credit Score Ranges
FICO Scores range from 300 to 850. A FICO Score of 670 or higher is considered good. Here’s a breakdown of the FICO Score ranges.
- 800-850: Exceptional
- 740-799: Very good
- 670-739: Good
- 580 to 669: Fair
- 300-579: Poor
In 2006, the three major consumer credit bureaus—Experian, TransUnion and Equifax—joined forces to introduce the VantageScore. As with the FICO Score, there are multiple versions of the VantageScore; however, there are no industry-specific VantageScores. The latest version of this score model, VantageScore 4.0, was introduced in 2017.
VantageScore considers credit factors in the following order but isn’t as specific as FICO in defining how much each element is weighted.
- Total credit usage, balance and available credit: Extremely influential
- Credit mix and experience: Highly influential
- Payment history: Moderately influential
- Age of credit history: Less influential
- New accounts opened: Less influential
VantageScore Credit Score Ranges
VantageScore scores range from 300 to 850. A VantageScore credit score of 700 or more is considered good or better. Here’s what the different VantageScore ranges mean.
VantageScore Credit Score Ranges
- 750-850: Super prime or excellent
- 700-749: Good
- 650-699: Fair
- 550-649: Poor
- 300-549: Very poor
Industry-Specific Credit Scores
In addition to the base FICO Score, FICO also has industry-specific credit scores for lenders in the credit card and auto loan industries, called the FICO Bankcard Score and FICO Auto Loan Score. Just as with the base FICO Score, there are multiple versions of each of these credit scoring models, the latest of which are FICO Bankcard Score 9 and FICO Auto Loan Score 9.
Educational credit scores
When you get your credit score for free from your bank, lender, credit card company or free credit score app, this is called an “educational” credit score. It may not be up-to-date and typically will not be the same score that lenders see. Most free scores are VantageScores.
The CE or “Community Empowerment” score was a credit scoring model invented by CE Analytics. It was intended to be more transparent than other credit scoring models and was provided free to consumers. This score is no longer offered and there are many other ways to get your credit score for free.
Other Credit Scoring Models
Some lenders have their own proprietary credit scoring models that they may use either alone or in conjunction with VantageScore and FICO Score models.
Why Are There Different Credit Scores?
Your credit score can vary based on a variety of factors. The credit scoring model that’s used will affect your score. Not only do FICO Scores and VantageScores weigh different aspects of your credit usage differently, with four VantageScore models and dozens of FICO Score models, it’s easy to see how your score might diverge.
Your score could also change based on which credit bureau’s credit report is used to calculate it. Different credit bureaus’ reports often have different data. Not all creditors report to all three credit bureaus, and even if they do, they may send updates to the bureaus at different times of the month. Experian’s credit report might show you still have a $2,000 balance on a credit card that you paid off last week. TransUnion’s report might show you with a zero balance on that card. Equifax’s report might not even list that card at all.
How to Check Your Credit Scores and Reports
You can get a copy of your credit report from each of the three consumer credit bureaus Experian, TransUnion and Equifax—for free at AnnualCreditReport.com. Normally, this is limited to once a year, but during the pandemic, you can get your credit report free once a week.
You can get your credit score from a variety of sources, some free, some paid. For instance, some banks, credit unions or credit card companies provide free access to your credit score. You can also get your credit score and credit report free from Experian.
Depending on where you get your credit score, it might be a FICO Score or a VantageScore. For instance, Experian will show you your FICO Score 8, the most frequently used credit score.
FAQs About Types of Credit Scores
The FICO Score 8 is currently the most commonly used score. However, which score matters most depends on the type of credit you’re seeking and the specific criteria your lender uses. Lenders may use one or more credit scores, and you typically won’t know exactly which one. Keeping tabs on your FICO Score can give you a good idea of where your credit stands.
There’s a common misconception that people have three credit scores. This may be because credit scoring models can use data from any one of the three major consumer credit bureaus: Experian, TransUnion and Equifax. Since not all credit accounts report to all three credit bureaus, your Experian credit report might have different data from your TransUnion credit report, and so on. This can affect your credit score.
The two main types of credit scores are FICO Scores and VantageScores.
Since credit scores are drawn from three different credit bureaus’ credit reports and calculated using many different credit scoring models, you may have dozens of credit scores at any one time.
A good credit score depends on which credit scoring model is used. A VantageScore of 700 or more is good; a FICO Score of 670 or higher is good. If your score is lower than that, consider signing up for Experian Boost™, a free service that adds your on-time cell phone, utility and streaming service payments to your credit report, or for credit monitoring services.