Difference Between Vantage Scores and FICO Scores

Credit Improvement
April 16, 2024

Do you know what the difference between a Vantage score and a FICO score is?

The answers are - not that much.

Even though there isn't large difference between a Vantage score and a FICO score, both scores are unique in how they can calculate your credit score, and they are mostly unique in who uses them. We have listed out some main differences and similarities, but the major difference is who uses them. Mortgage lenders are the biggest user of a FICO score, while most credit monitoring services use a Vantage score. This leads many people wondering why their credit score is a 720 on their credit monitoring platform, but only a 650 when a lender pulls their credit. Below are some of the differences between the two scroing models.

Did you realize that your creditworthiness isn't determined by just one credit score? There are numerous credit scoring agencies and models, each with its own method of computing credit scores based on the data in your credit reports.

Depending on the model or credit bureau providing the data, your credit scores can vary. Lenders use these scores to assess the likelihood of you paying your bills on time and to decide whether to approve your credit applications. They also consider factors like your income and their own lending criteria.

Two major players in credit scoring are Fair Isaac Corporation (FICO) and VantageScore. VantageScore is a collaboration between Equifax, Experian, and TransUnion, the three main credit bureaus.

Both FICO and VantageScore assign higher scores to borrowers deemed lower-risk, with scores typically ranging from 300 to 850.

FICO considers five categories, each with its own weight:

  1. Payment history (35%)
  2. Credit utilization (30%)
  3. Length of credit history (15%)
  4. Credit account mix (10%)
  5. New credit accounts (10%)

VantageScore looks at six categories, with varying levels of influence:

  1. Payment history (extremely influential)
  2. Credit utilization (highly influential)
  3. Length and mix of credit history (highly influential)
  4. Amounts owed (moderately influential)
  5. Recent credit behavior (less influential)
  6. Available credit (less influential)

However, there are differences between the two:

  1. Credit history length: FICO requires at least six months of credit history, while VantageScore only needs one month.
  2. Hard inquiries: Both count multiple inquiries for the same purpose as one, but the time frame differs (45 days for FICO, 14 days for VantageScore).
  3. Collection accounts: FICO disregards smaller collections under $100, while VantageScore includes all unpaid collections.

So, depending on your credit activity and the scoring model used, you may have different credit scores. When it comes to purchasing a home, it is good to remember that a FICO score is normally 40-60 points lower than a Vantage score. Therefore, if you have a target FICO score you are trying to get to, and you are monitoring it with a credit monitoring service there is a good chance that you need your Vantage score to be about 50 points or higher than your target FICO score.

HomeLoanGurus can help you increase your FICO score by reporting your rent payments to the credit bureaus. If you are a renter and are trying to qualify for a home loan, we can help you get the benefit of your rent payments.

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