Credit Score Explained. FICO 8, Vantage Score 3.0 Scoring Models. (2024)

FAQs

What does a VantageScore of 3.0 mean? ›

VantageScore 3.0: A credit score. built for predictiveness. The VantageScore 3.0 model combines better-performing analytics with more granular data from the three national Credit Reporting Companies (CRCs) to generate more predictive and consistent credit scores for more people than ever.

There is no official method of converting a Vantage Score to a FICO Score. Each scoring model uses different criteria and methods of pulling credit reports data; it's nearly impossible to convert. However, keeping both scores in mind can give you a much more well-rounded understanding of your credit reports health.

Because VantageScore was created by the three credit bureaus, it uses a tri-bureau model that works with a credit report from any of the three credit bureaus. Meanwhile, FICO creates and uses a credit-scoring model that is unique for each of the credit bureaus.

FICO^® Score 8 is a base credit score that credit providers use to help figure out a potential borrower's credit risk. Your payment history, credit utilization, length of credit history, new credit inquiries, and the types of accounts you have (your credit mix), are all factors that come into play within FICO^® Score 8.

VantageScore 3.0 and 4.0 both ignore paid collection accounts and ignore even unpaid medical collection accounts, regardless of their balance.

According to the company, FICO® scores are used today by 90% of top lenders to make lending decisions. The VantageScore model wasn't introduced until 2006.

FICO and VantageScore have different minimum requirements to get a credit score. FICO and VantageScore have different criteria for who can get a credit score. VantageScore has fewer, or lower, minimum requirements by comparison, because it was designed to help previously unscorable consumers qualify for credit scores.

Although VantageScore's system is accurate, it's not the industry standard. Credit Karma works fine for the average consumer, but the companies that will approve or deny your application are more likely to look at your FICO Score.

FICO 8 is still the most widely used credit score today. If you apply for a credit card or personal loan, odds are that the lender will check your FICO 8 score. FICO 8 is unique in its treatment of factors such as credit utilization, late payments, and small-balance collection accounts.

Do landlords use FICO or VantageScore? It's up to the preference of the landlord, but they may check either your FICO score or your VantageScore (but probably not both). FICO scores tend to be more commonly used.

What is the current average credit score in the US? ›

The average FICO credit score in the US is 717, according to the latest FICO data. The average VantageScore is 701 as of January 2024. Credit scores, which are like a grade for your borrowing history, fall in the range of 300 to 850.

Chase Credit Journey^® uses the VantageScore^® 3.0 model, which calculates your score based on these 6 key score factors. Other models, like the Fair Isaac Corporation (FICO^®), may use different factors.

The primary credit scoring models are FICO® and VantageScore®, and both are equally accurate. Although both are accurate, most lenders are looking at your FICO score when you apply for a loan.

The base FICO score is also called FICO Score 8 or 9. It's not designed specifically for auto loans, but many lenders use it. It's a number between 300 and 850, and a higher score means that a person is more likely to make loan payments on time.

Which is better: FICO score 8 or 9? FICO Score 9 is slightly more forgiving than FICO Score 8 since paid-off debt in collections no longer factor in, medical debts are treated differently, and consumers get more help with their credit when their rent payments are reported to the credit bureaus.

Using VantageScore^® for Mortgages

Recently, the Federal Housing Finance Agency (FHFA) approved the use of VantageScore 4.0 for lenders who sell loans to Fannie Mae or Freddie Mac (Government Sponsored Enterprises, or GSEs).

The average VantageScore 4.0 consumer credit score is 697 as of August 2022. This is considered a “prime” score, according to VantageScore's ranges. A prime score is one tier down from the best range. A 697 is considered a good credit score by NerdWallet's guidelines.

VantageScore 3.0 ranges from 300 to 850, just like the FICO score does. According to Experian, one of the three major credit bureaus, here are the credit score ranges: Excellent: 781 to 850. Good: 661 to 780.

Monitoring your score for changes can be useful, as long as you understand that the two score types likely won't ever match. In Brian's experience, scores based on VantageScore are 100 points lower than FICO-based scores, which are what lenders tend to use. This is because the scores are composed in a different way.