What do the different versions of FICO scores mean?

You may have noticed that your credit score seems to change depending on where you check it. Whether you’re choosing a mortgage lender, shopping for an auto loan or looking for the best deal on a credit card, there’s a good chance your scores won’t be an exact match.

One reason your score might look different is that there are multiple versions of FICO scores and VantageScores. Each can paint a slightly different picture of your financial health.

What FICO scores are and what they mean

A FICO score, developed by the Fair Isaac Corporation, has been used by lenders since 1989 to evaluate consumers’ credit risk. These three-digit scores typically range from 300 to 850 (although industry-specific scores can use a broader range of 250 to 900).

A higher FICO score suggests that you have managed credit well and are less risky to lenders, which often leads to better interest rates and loan terms. The average FICO score in the U.S. is 717 for FICO 8, which is the most commonly used score.

Why there are different FICO score versions

There are multiple versions of FICO credit scores for two main reasons:

• Changing analytics: FICO scores are periodically redeveloped to incorporate new analytic tools. When FICO releases new versions to the market, lenders must decide whether to adopt the latest version or stick with the one they are currently using.
• Industry-specific scores: Some FICO score versions are tailored to specific types of financial products. For example, industry-specific versions of FICO focus on auto loans and credit cards (referred to as “bankcards” in the context of FICO scores).

How different FICO score versions are used

The most widely used version of FICO scores is called FICO score 8. If you are unsure which version of your FICO scores you should monitor, FICO score 8 is a good place to start.

Since its release in 2014, FICO score 9 has also been commonly used, although it hasn’t yet reached the level of use that FICO score 8 has.

FICO score 8 vs. 9

Versions 8 and 9 of FICO scores are similar, but FICO score 9 is generally considered the more forgiving of the two for a few reasons:

• With FICO 9, third-party collections no longer hurt your credit score once those debts are paid off.
• FICO 9 treats medical collections differently than other types of debt. Unpaid medical collections will impact your score less significantly than other unpaid collections.
• FICO 9 can consider your rental history as long as your landlord reports the payments. This can help young adults build credit faster.

FICO scores 8 and 9 are commonly used for student loans, personal loans, medical loans, credit card lines and auto loans. However, there are industry-specific FICO versions for certain types of debt as well, including auto loans and credit cards.

FICO Scores 10 and 10T

Introduced in 2020, FICO Scores 10 and 10T are the newest versions of the FICO scoring model. These versions were designed to provide a more precise evaluation of credit risk by incorporating newer data and trends in consumer behavior. They both still use the same algorithms as FICO Scores 8 and 9, but 10T also brings a new element to the table: trended data.

Trended data looks at credit behavior over time rather than just a single snapshot, giving a more dynamic view of your financial habits. For instance, FICO 10T considers how consistently you’ve paid down your credit card balances over the past 24 months, which can help distinguish between someone steadily reducing debt and someone who tends to carry higher balances.

Industry-specific FICO score versions

According to myFICO.com, industry-specific FICO credit scores leverage all the predictive power of the base FICO scores but are fine-tuned to reflect the unique risk factors associated with different types of credit, such as auto loans and credit cards.

By offering auto-specific and bankcard-specific FICO scores, FICO has managed to tailor its products and provide more clarity to the lenders who use them. Here’s how they are commonly used.

Auto lending

In addition to the standard FICO score 8 or 9, an auto lender might use:

• FICO Auto score 2
• FICO Auto score 4
• FICO Auto score 5
• FICO Auto score 8
• FICO Auto score 9
• FICO Auto score 10

Credit card lending

In addition to the standard FICO score 8 or 9, credit card companies might use one of the following:

• FICO score 3
• FICO Bankcard score 2
• FICO Bankcard score 4
• FICO Bankcard score 5
• FICO Bankcard score 8
• FICO Bankcard score 9
• FICO Bankcard score 10

Mortgage lending

In addition to the standard FICO score 8 or 9, mortgage lenders might use one of the following:

• FICO score 2
• FICO score 4
• FICO score 5

FICO score use among different credit bureaus

The three credit bureaus, Experian, Equifax and TransUnion, track credit histories for individual consumers. Each bureau assigns consumer credit scores based on the information it receives from creditors, which means a consumer could have a different FICO score from each bureau.

Here are the most commonly used FICO credit score versions across the different credit bureaus:

How FICO scores are calculated

Each FICO version weights different aspects of your credit history slightly differently, but all FICO scores are calculated based on the following five factors:

• Payment history (35%): Considers whether you’ve made payments on time. This is the most significant factor in determining your score.
• Amounts owed (30%): Looks primarily at the total amount of credit you’re using relative to your available credit limits, also known as your credit utilization ratio.
• Length of credit history (15%): Factors in how long your credit accounts have been open. Longer histories generally increase scores.
• Credit mix (10%): Evaluates the variety of credit types you have, such as mortgages, student loans and credit cards. This shows your ability to manage different kinds of credit responsibly.
• New credit (10%): Considers how many new accounts you’ve recently opened, as multiple new accounts might indicate greater risk to lenders.

How to check your FICO scores

You can check your credit scores in several ways.

Many lenders participate in the FICO Score Open Access program, which provides their customers with free access to their FICO scores and insights to better understand their credit health. Credit monitoring services like Experian also offer a free FICO Score 8. You can also get your credit report for free from AnnualCreditReport.com

What if you want to view an industry-specific version of your score? Perhaps you’re getting ready to buy a home, and you want to see what your mortgage lender will see when they pull your credit. In this case, you could subscribe to a service like myFICO, which allows you to access various FICO score versions, including those used for auto loans, credit cards and mortgages.

You can also contact the credit bureaus directly to purchase a report that includes the specific score version you need. Additionally, you are entitled to a free copy of any credit report a creditor uses to make a lending decision. You simply need to request it in writing from the creditor within 60 days of the credit pull.

How to improve your FICO scores

You can build a good credit score by improving in each of the five areas measured by FICO scores:

1. Payment history: If you have past-due bills, bring them current and pay all your bills on time going forward.
2. Amounts owed: Try to use less of your available credit. For example, if you have a credit card with a $10,000 limit, keep your balance under $3,000.
3. Length of credit history: Don’t close your credit card accounts when your cards are paid off. Keep them open so they add to your credit history length.
4. Credit mix: Minimize consumer credit card debt.
5. New credit: Avoid opening multiple credit lines in quick succession.

If you have a low FICO score, focusing on these steps should help raise it over time. However, if you are overwhelmed or aren’t making progress on your own, you may consider working with a professional credit repair company to help raise your score.

The bottom line

It’s normal for your FICO score to vary slightly depending on the version a lender uses. These variations are part of a broader effort to improve credit risk assessment tools over time. While it may seem surprising to see different scores, the differences are typically minor and are unlikely to impact whether you are approved for a loan.

To protect your creditworthiness, consider tracking your credit through free reports or subscription services. Monitor the activity closely and report any errors as soon as possible. Taking a proactive approach can help keep your FICO scores up, regardless of which version your lender chooses to use.

Frequently asked questions

• Is my FICO score included on my credit report?

  No, your FICO score is not included on your credit report. You typically need to obtain your credit score separately from a credit bureau or a credit monitoring service. Some personal finance sites and credit cards offer the ability to loo at your FICO scores for free.
  

• Do all lenders use FICO scores to evaluate creditworthiness?

  No, while most lenders use FICO scores to assess credit risk, some may use alternative scoring models like VantageScore or their own proprietary scoring systems. It’s important to ask your lender which scoring model they use when you apply for a loan or credit product.
  

• How often should I check my FICO score?

  It’s a good idea to check your FICO score at least once a year. However, if you’re working on improving your score, tracking it monthly or quarterly can help you monitor your progress and make proactive changes.