Commonly Used Credit Scores

Most lenders have their own systems for determining creditworthiness, but one stable factor among most is that they use either the FICO® Score or the VantageScore® scoring system.

Your credit score is the single largest factor that determines what financing options are available to you as a consumer. Once you’ve become familiar with what determines a good credit score and what aspects of your life it can affect, it’s time to understand where these common credit scores come from and what they actually mean.

Did You Know You Have Multiple Credit Scores?

There are literally dozens of different scores or versions of scores that you may see or hear about, but the scores given by the three main credit bureaus are our primary focus, as these most common credit scores make up the core of the credit reporting industry:

All three keep track of your credit history and create their own version of your credit score. Although the scores provided by each may vary, often the variances are not significant and shouldn’t be a cause for alarm. Variances can happen because not all creditors will report all debts to all three bureaus or they can simply be caused by the different proprietary calculations each bureau uses to formulate your score.

Most lenders have their own systems for determining creditworthiness, but one stable factor among most is that they use either the FICO® Score or the VantageScore® scoring system.

FICO Score

The FICO Score system is one of the most widely used credit scoring models in the United States. It is used in approximately 90 percent of lending decisions. The FICO credit score range was originally introduced in 1989 to help lenders, such as banks and other institutions, calculate the risk of lending to a particular consumer.

Although the major credit bureaus will have an additional credit measurement system, it is largely believed throughout the industry that the base for all common credit scores is derived partly from the FICO Score. Experian uses a model called the FICO® Advanced Risk Score and TransUnion uses a model called the Precision score, while Equifax uses a model called the Pinnacle score.

The FICO Score is calculated based on the following factors:

  • Payment history – 35%
  • Amounts owed – 30%
  • Length of credit history – 15%
  • New credit – 10%
  • Types of credit used – 10%

FICO’s common score range is from 300 to 850, although there are slightly different credit score ranges for different types of loans. For example, those looking to acquire an auto loan may be looking at a FICO Auto Industry Option credit score range of 250 to 900. This score is not available to consumers and can only be seen by the auto industry (dealers and finance companies); it places more emphasis on how you have handled previous auto loans.


Another credit scoring model is the VantageScore. This scoring system was developed by Equifax, Experian, and TransUnion in 2006 as an alternative to the FICO scoring system. While the FICO common credit score range is 300 to 850, the Vantage common credit score range is 501 to 990. This can cause some confusion since while the majority of lenders use the FICO model for lending decisions, when a consumer purchases their scores directly from the bureaus they will often be given the higher VantageScore.

The VantageScore is calculated based on the following factors:

  • Payment history – 32%
  • Credit utilization – 23%
  • Credit balances – 15%
  • Depth of credit (this is your credit history) – 13%
  • Recent credit – 10%
  • Available credit – 7%

A couple of important things to note about differences in the scoring models outside of just the different score ranges. The VantageScore penalizes late payments on your mortgage more heavily than late payments on other accounts while FICO penalizes all similarly. They also account for third party collection accounts differently; FICO ignores accounts under $100 but treats anything $100 or above the same, while Vantage minimizes the effect of reported collections under $250.

What Is A Good Score?

Due to the diversity of credit score uses, it is often up to the individual lenders to determine what a “good” credit score range is. One lending agency may determine that a score of 645 is sufficient, where another may decide you need a score of 720 or higher to get the best interest rate or to be approved at all. Among all credit scoring systems there is a common truth – the higher your credit score the better. If you find you have a FICO-based credit score under 700, it can be beneficial to try to determine if there are inaccuracies or negative items that need to be fixed.

It’s important to understand that although there are many credit reporting services that will offer you a free credit report, often these will not include your FICO or Vantage credit score and will instead be based on a proprietary scoring model that may or may not closely match the common credit scores that a lender would see. The FICO Score and VantageScore are normally available for a fee.

At AmONE, we will connect you for free with a credit reporting or monitoring agency that can help you find out where your credit scores currently are. We can help to ensure that your credit remains in good standing and help you determine any necessary steps needed to get your credit back to what’s generally accepted as good or better. For further information about how we can help please, please complete our easy to use online credit solutions form or call us toll-free at 1-800-809-1107 to speak with one of our financial search specialists.