FICO vs Vantage
FICO vs Vantage – which is better? what are the key differences and how to convert between Vantage and FICO? We’ll try to answer all those questions…
VantageScore vs FICO Score – Why two scores?
The concept of credit scores was first introduced in the 80’s by the Fair Isaac Corp. The scoring model they developed is called FICO, and is still the dominating credit score to date.
The Fair Isaac Corp however need credit information to run their model on, which is where the three major credit bureaus come into the picture – they collect credit data, run the FICO algorithm and produce FICO scores.
Because the credit bureaus have to pay royalties to the Fair Isaac Corp every time they generate a score, they came up with a credit score of their own – Vantage Score. And so, the VantageScore was born in 2006.
FICO vs Vantage key differences
There are 4 key differences between FICO and Vantage:
FICO vs Vantage Score Range
FICO ranges on a 300 – 850 scale.
The first versions of Vantage (Vantage 1.0 and later on Vantage 2.0) initially ranged between 500 – 990, which made any comparison between FICO vs Vantage almost impossible.
To solve this problem the three credit bureaus changed the Vantage model and in 2013 launched Vantage 3.0 that adopted the 300 – 850 range used by FICO.
The latest Vantage 4.0 released in 2017 continues to use the 300 – 850 range.
Bottom line: If you wish to convert the old Vantageto FICO follow this link: Convert VantageScore 2.0 to FICO. No conversion is needed between Vantage 3.0/ or Vantage 4.0 and FICO since they use the same range.
FICO vs Vantage Credit Tiers
Although Fico & Vantage uses the same score range, they impact lender’s decision differently:
| Range | Rating | % of People | Impact |
|---|---|---|---|
| 800 – 850 | Exceptional | 21% | Applicants with scores in this range are at the top of the list for the best rates from lenders |
| 740 – 799 | Very Good | 25% | Applicants with scores here are likely to receive better than average rates from lenders |
| 670 – 739 | Good | 21% | Only 8% of applicants in this score range are likely to become seriously delinquent in the future |
| 580 – 669 | Fair | 17% | Applicants with scores in this range are considered to be subprime borrowers |
| 300 – 579 | Very Poor | 16% | Credit applicants may be required to pay a fee or deposit, and applicants with this rating may not be approved for credit at all |
| Range | Rating | % of People | Impact |
|---|---|---|---|
| 781 – 850 | Exceptional | 23% | Applicants most likely to receive the best rates and most favorable terms on credit accounts |
| 661 – 780 | Good | 38% | Applicants likely to be approved for credit at competitive rates |
| 601 – 660 | Fair | 13% | Applicants may be approved for credit but likely not at competitive rates |
| 500 – 600 | Poor | 21% | Applicants may be approved for some credit, though rates may be unfavorable and with conditions such as larger down payment amounts |
| 300 – 499 | Very Poor | 5% | Applicants will not likely be approved for credit |
FICO vs Vantage Scoring Factors
This is where FICO really differs from Vantage. That use different models and put different weights on different data types:
| Payment history | 35% |
| Level of debt/amounts owed | 30% |
| Age/length of credit history | 15% |
| Types of credit/credit mix | 10% |
| Credit inquiries/new credit | 10% |
| Payment history | 40% |
| Age and type of credit | 21% |
| Percent of credit used | 20% |
| Total balances/debt | 11% |
| Recent credit behavior and inquiries | 5% |
| Available credit | 3% |
Vantage 4.0 changes the scoring criteria a bit:
| Payment history | 41% |
| Age and type of credit | 20% |
| Percent of credit used | 20% |
| Recent credit behavior and inquiries | 11% |
| Total balances/debt | 6% |
| Available credit | 2% |
FICO vs Vantage – Which is better?
From a consumer’s standpoint, the credit score to consider is the one your prospective lender is using to approve or decline your application.
More lenders are using the FICO than Vantage, but you shouldn’t assume that. Always ask your prospective lender which credit score they’ll be checking, and which version.
Also note that many sites that offer free credit scores are using old versions of FICO or Vantage, so the free credit scores they offer probably won’t match the one the lender receives.