FICO vs. VantageScore: Which Credit Score Matters More?

When it comes to credit scores, there are two major players to watch: FICO and VantageScore. Both are used by lenders to assess your creditworthiness, but they do have some key differences. Here's what you need to know about FICO vs. VantageScore and which one matters more.

What is a Credit Score?

Your credit score is a three-digit number that represents your creditworthiness. It's based on your credit history, including factors like your payment history, the amount of debt you have, and the length of your credit history. Having good credit is important because it signifies to lenders that you're a low risk and a good candidate for loans and other forms of credit.

Both FICO and VantageScore are used by lenders to assess your creditworthiness, but they do have some key differences. FICO is the most widely used credit score in the United States, and it's used by over 90% of lenders. VantageScore, on the other hand, is a newer credit score that was developed by the three major credit bureaus (Equifax, Experian, and TransUnion).

How are FICO and VantageScore Different?
FICO and VantageScore use different formulas to calculate your credit score. FICO's formula is more complex, which means that it can be more accurate in predicting your creditworthiness. However, VantageScore is generally considered to be more lenient, which means that it may give you a higher score than FICO.

Which Score Matters More?
When applying for a loan or other form of credit, both FICO and VantageScore will be considered by lenders; however, your FICO score will typically be given more weight. This is because FICO has a longer track record and more data to work with. The vast majority of lenders use FICO scores to make decisions about whether or not to approve an applicant for a loan or credit card.

However, FICO and VantageScore are both important to keep an eye on. If you have a low score on either one, it could be a sign that you need to improve your credit habits.

How to Improve Your FICO and VantageScore

There are a few things you can do to improve your FICO and VantageScore:

• Pay your bills on time, every time.
• Keep your credit utilization low.
• Don't open too many new credit accounts in a short period of time.
• Dispute any errors on your credit report.
• Build your credit history by using a credit card and paying it off in full each month.

Conclusion

FICO and VantageScore are the two most important credit scores to track. FICO is the most widely used credit score, but VantageScore is generally considered to be more lenient. Both scores are important to lenders, but FICO is typically given more weight. By following the tips above, you can improve your FICO and VantageScore and increase your chances of getting approved for loans and other forms of credit.

Additional Resources:

• FICO
• VantageScore
• AnnualCreditReport.com

Tables

Table 1: FICO vs. VantageScore

Table 2: Factors that Affect Your FICO and VantageScore

Table 3: Average FICO and VantageScore

Table 4: Credit Score Ranges