Have You Heard About Your VantageScore?

Most people know about FICO scores – the brand of credit score that’s generated by the company called FICO, formerly Fair Isaac. But the VantageScore is newer and not as well known, but that doesn’t mean they’re not as important.

The VantageScore was developed by the three major credit bureaus – Equifax, Experian, and TransUnion. In some ways VantageScores are easier to understand – credit scores also correspond to a letter that makes it easy to tell if you have a good or bad credit score. Both Experian and TransUnion sell a VantageScore based on your credit report at their bureau. However, Equifax doesn’t offer a VantageScore.

The VantageScore says that it’s available for more consumers than other credit scores – like those with limited credit histories or thin credit files – making it easier for those consumers to get access to credit cards and loans. That benefit is only realized if the lender uses the VantageScore versus other credit scores and even their own credit scoring model.

VantageScore Range

While the FICO score ranges from 300 to 850, the VantageScore range from 501 to 990.

• 900-990 = A
• 800-899 = B
• 700-799 = C
• 600-699 = D
• Below 599 = F

As with most other credit scoring models, higher credit scores are better than lower credit scores. Consumers with credit scores in the “A” category have the best scores and get the best terms from lenders.

What’s in the VantageScore?

Like your FICO score and other credit scores, Your VantageScore is based on information in your credit report. For example, your account payment history and account balances. Different factors counts toward your score in different weights.

• 28% of your VantageScore is your payment history or how well you’ve paid your accounts on time
• 23% considers the amount of available credit you’re using.
• 9% takes into account the total amount you owe
• 8% is your depth of credit or length of your credit history and the types of accounts you have
• 30% is the amount of accounts you’ve recently opened and the number of credit inquiries that have been made
• 1% take into account your available credit

Your VantageScore, like other credit scores, doesn’t take into any factor that’s not in your credit score, including your race, nationality, religion, gender, age, marital status, salary, or location.

Does the VantageScore Matter?

The most important credit score is the one your lender uses. That might be your VantageScore, FICO score, or another score. Sometimes lenders use their own credit scoring models that generally are not available to the public.

It’s important to know which credit score you’re checking so you’ll know where you stand. For example, a 760 FICO score is considered an excellent credit score. The same score on the VantageScore scale is an average “C” credit score, probably not worthy of the best credit score terms.

Improve Your VantageScore

The guidelines for improving your VantageScore are similar to that for other credit scores – pay your bills on time, borrow only what you need, don’t carry high credit card balances, and apply for new credit sparingly.

I am Frank Collins and I write on topics related to personal finance. Debt relief is my specialty but I also dive in related fields like credit reporting, risk evaluation and money management. If you are fighting debt take a look through some of my debt relief articles.