The new VantageScore is sort of challenging FICO which uses a number system to determine your credit score. The three bureaus are treating this as a test period.
The new VantageScore uses numbers and letters to determine your final credit score. Your report would list a letter score and a number score.
The VantageScore System
901 - 990: A
801 - 900: B
701 - 800: C
601 - 700: D
501 - 600: F
It is not yet clear if this new scoring system will have a positive or adverse effect on a lenders’ decision. There are many variations of credit scores because of the licensing cost to use FICO. This cost tends to be rather steep for lenders. Banks and other companies typically have a high volume request for scores which is why they are more willing to opt for a more cost effective solution. These other scores are typically referred to as non-Fico or even “FAKO” scores. However, the VantageScore system and is not a FAKO.
What is the difference between FICO and VantageScore?
The FICO score ranges from 300 to 850 while the VantageScore ranges from 501 to 990. It is based on five variables, while the VantageScore is based on six variables.
The following chart compares VantageScore to FICO and shows the percentage of a variable and its role in the total credit score. Click the image below.
Innovative Credit Consultants will be following the new scoring system and will keep you updated on consumer progress. Extra tip: Never assume a lender uses FICO. The VantageScore method could change your credit score by almost 50 points. Always ask your lender what scoring system they use
For more information about credit, visit icreditinc.com. You can also talk to a credit repair consultant who can help you boost your credit score.
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