What’s the difference between FICO vs. VantageScore credit scores? – USA TODAY Blueprint

You might know that a good to excellent credit score can help you qualify for great terms on your next loan or credit card. But many lenders use a score from either FICO or VantageScore. So how do you know which credit score your potential lender is going to use when evaluating your application? That’s trickier to answer. 

Credit scoring models analyze a credit report to estimate the likelihood that someone will miss a payment in the future. They then spit out a three-digit number that lenders can use to quickly understand the risk associated with extending credit to that person.

Although credit scores have proven to be valuable tools, lenders can choose which credit score they want to use. 

What are FICO and VantageScore?

FICO and VantageScore are competing for-profit companies that develop and sell consumer credit scores. Although the companies create similar products, they have very different histories. 

FICO is one of the oldest and most well-known scoring companies—its history dates back to 1956, and it introduced the FICO Score in 1989. Since then, the company has gone on to develop many versions and types of consumer credit scores, along with other analytics and decisioning tools. 

The major three consumer credit bureaus—Equifax, Experian, and TransUnion—worked together to found VantageScore in 2006. The company is independently managed, but the credit bureaus still own it. 

FICO and VantageScore credit scores: differences and similarities 

Just as Microsoft and Apple take different approaches to creating operating systems, there are differences between the FICO and VantageScore credit scores. FICO and VantageScore also periodically create new versions of their credit scores, and FICO offers different types of consumer credit scores. (There are also lesser-known scoring companies, the Linuxes of the scoring world, and some lenders create in-house credit scores.)  

FICO and VantageScore differences

Some of the basic differences between FICO and VantageScore are: 

• Minimum scoring requirements: To qualify for a FICO Score, your credit report must have a credit account that’s at least six months old and have an account with activity in it during the last six months (they can be the same account). To qualify for a VantageScore, you can have a credit report with a credit account that’s younger than six months old or an account that was active any time in the last 24 months. In either case, your credit report can’t indicate you’re deceased. 
• Hard credit inquiries: A hard credit inquiry—a record of a creditor checking your credit report before making a lending decision—can hurt your credit score. FICO scores won’t hold multiple hard inquiries from the same type of loan against you if you apply for multiple student loans, auto loans, or mortgages in a 14- to 45-day window (depending on the type of FICO Score). VantageScore doesn’t hold multiple hard inquiries for any type of new credit account against you as long as they happen within 14 days. 
• FICO creates many types of credit scores: FICO and VantageScore both create “generic” credit scores that are intended to be used by any type of lender. But FICO also builds on its generic scores to offer industry-specific auto loan and credit card scores. Additionally, FICO creates other types of credit scores and non-credit models, such as the UltraFICO Score which can incorporate information that’s not in a credit report and the FICO Resilience Index, which identifies consumers who will be more financially resilient during times of economic stress. 
• VantageScore uses the same model with all three bureaus: VantageScore develops tri-bureau models, meaning the same model analyzes credit report information from all three bureaus. FICO Score versions might share one name, such as the FICO Score 9, but there are technically three different FICO Score 9s—one for each credit bureau. 

FICO and VantageScore models also use different weighting and rules when determining your credit scores. As a result, your scores could be different, even if a model from each company is scoring the same credit report. 

But there are also differences between the scoring models from the same company. For example, some of the latest scoring models — the FICO Score 10T and VantageScore 4.0 — considered trended credit data. This could include whether you revolve a credit card balance, are paying down your balances over time, or regularly pay off your credit card in full. Previous models from both companies didn’t use trended data. 

FICO and VantageScore similarities

Although there are some differences between FICO and VantageScore credit scores, they are also similar in important ways. Both companies’ generic consumes credit scores:

• Use the same underlying data. The scores are created by analyzing the information in one or more of your credit reports from Equifax, Experian, or TransUnion. 
• Try to predict the same thing. The scores all try to predict the likelihood that someone will fall at least 90 days behind on any credit payment in the next 24 months. 
• Range from 300 to 850. All the latest generic scoring models range from 300 to 850, with a higher credit score being better. However, FICO’s industry-specific models and VantageScore 1.0 and 2.0 have different score ranges. 

With this in mind, it might be more important to focus on your credit reports than a specific scoring model. Using credit accounts, making payments on time, and keeping credit card balances low can help improve all your credit scores.

How to get your VantageScore and FICO credit scores for free

You can get free copies of your VantageScore and FICO Score from credit card issuers, banks, credit unions, lenders and third-party providers. Your scores depend on which scoring model the platform gives you and which one of your credit reports the scoring model analyzes. 

• The VantageScore website lists creditors and platforms that offer free VantageScores. 
• FICO lists authorized retailers, lenders, and service providers that can give you access to one of your FICO Scores.

You can also get copies of your credit reports for free on AnnualCreditReport.com, but the reports won’t come with a credit score. 

Do lenders prefer your FICO score or VantageScore?

FICO claims that 90% of top lenders use FICO Scores and 10 billion FICO Scores are purchased every year. VantageScore claims 2,600 financial institutions, including nine of 10 of the largest banks, use VantageScores.

But lenders can choose which scoring models to use, and some might use multiple types of credit scores. For example, they might try to approve your application with a FICO Score and then try again with a VantageScore if you don’t get approved with a FICO Score. Or, they might make an initial lending decision with one type of credit score and then monitor (perhaps to raise or lower your credit limit) your account with a different type of score. 

Some creditors even create their own in-house credit scores. They might use these instead of buying a score from FICO or VantageScore, or use a FICO or VantageScore score as an input in their score.

It can all get pretty complex. But fortunately, you don’t need to try to monitor and optimize all your credit scores. Focus on building a positive credit history by using credit responsibly and you might find your scores start to rise in tandem.