| Everyone can get his or her own credit score but | | | | Experian, Trans Union and Equifax, together created a |
| unlike credit reports we are not entitled to a free copy | | | | new credit scoring system to generate scores. It was |
| which will be issued by the credit reporting agencies | | | | called Vantage Score. |
| once a year. Credit scores can be availed at a | | | | Vantage Score has scores ranging from 501 to 990 |
| reasonable fee. Another difference reports have from | | | | while FICO the digits are from 300 to 850. For a long |
| scores is with regards to disputes. As we all know | | | | time, it has been an industry norm to use the FICO |
| credit reports contents can be disputed however this | | | | scoring thus it is wise to know what kind of scoring |
| does not hold true for credit scores. | | | | was used by your lender to know where one really |
| As according to the Fair and Accurate Credit | | | | stand. This is because the Vantage Score and FICO |
| Transactions Act credit score is defined as the | | | | scores use different digit-range thus having the score |
| numerical value of a categorization derived from a | | | | of 810 might appear to be high enough to be on top of |
| statistical tool or modeling system used by a person | | | | the list of FICO but not really for the Vantage Score. |
| who makes or arranges a loan to predict the likelihood | | | | There are also some differences when it comes to |
| of certain credit behaviors, including default and the | | | | the variables considered by these two scoring |
| numeric value or categorization derived from such | | | | methods. On one hand FICO scores consider 35% for |
| analysis may also be referred to as a risk predictor or | | | | payment history, 30% amounts owed, 15% length of |
| risk score. | | | | credit, 10% new credit and 10% type of credit. One the |
| The first company to develop a scoring system was | | | | other hand, Vantage Score allotted 32% payment |
| the Minnesota based Fair Isaac, Inc. their scoring | | | | history, 23% utilization of available credit, 15% credit |
| method included factors serving as criteria that can be | | | | balances, 13% length and depth of credit history, 10% |
| found in the report. During the 1990s this system was | | | | recently opened accounts and 7% available credit. |
| adopted by mortgage industries. Recently the use of | | | | One reason why credit scores were utilized by |
| scores has become more rampant and is used by | | | | financial institutions and lenders is because they |
| nearly all lenders to help them decide whose loans or | | | | wanted to eradicate biases along the way of the |
| credit to be granted or denied. | | | | crediting industry. If properly developed a credit |
| FICO is still continuing to be the dominating credit | | | | reporting system can really help make decisions more |
| scoring method but this is not the sole scoring system. | | | | accurately than an individual can. |
| In 2006 the three major credit reporting bureaus, | | | | |