How Many Credit Scores Are There?

Scott wrote in earlier this week with a very good question:

I bought my credit score when I received my report from TransUnion. The interesting thing is that the score I received was a VantageScore. Is this the same as a FICO score?

I also received my PLUS score from Experian when I received their credit report. So I'm wondering if Experian is actually using the new FICO model? Or are then simply calling their FICO scores by a different name? I'm very confused as myFICO shows me yet another credit score...?

Hold on your hats, my answer is going to be a little messy and it may make you mad.

To start: no, a FICO score is not the same as a VantageScore or a PLUS score.

Each of the three national credit bureaus - Equifax, Experian and TransUnion - have a stable of credit scores that they sell to businesses and consumers. Each score is developed for a specific purpose. It might be tailored to an auto lender, a credit card marketer or a consumer.

Some of these scores are from FICO and some are developed in-house by the credit bureaus. FICO scores are more expensive, so they're not used as often in consumer products. A consumer FICO score is different than a FICO score used by a lender.

Here's a quick breakdown of some of the most common credit scores used:

Equifax
Equifax is the one credit bureau that uses FICO scores for most of their products. If you order a credit score from Equifax.com or AnnualCreditReport.com, it is going to be a FICO score. Equifax was a part of developing the VantageScore with the other two bureaus, but isn't currently selling it anywhere that I've seen.

Experian
If you order your credit score from Experian.com or one of their affiliates (FreeCreditReport.com, etc) you're going to get a PLUS score. This score is pretty similar to the FICO score. If you order from AnnualCreditReport.com, you're going to get a VantageScore. This score is pretty different from FICO. You should expect a 100 point difference between the two scores due to differences in the formula and range (501-990 vs. 300-850).

TransUnion
If you order a credit score from TransUnion.com or TrueCredit, you're going to get their TransRisk Score. There are a couple different versions of this score, some are closer to FICO than others. If you order through AnnualCreditReport.com, you'll get the VantageScore. TransUnion also has a small satellite site called TransUnionCS.com that sells FICO scores. 

FICO
myFICO.com obviously sells FICO scores for all three of the bureaus. These scores are more expensive to purchase than other options. Fair Isaac market a wide variety of FICO scores to business customers.

Feeling a little frustrated and confused? That's how most customers end up after discovering that the credit score they bought online wasn't a "real" credit score.

What's the solution? It's tricky because there isn't really a "real" credit score at all. Even if you pay the premium price for a consumer FICO score online, it isn't going to be exactly the same as the FICO score your lender would use.

My advice? Stay away from the VantageScore but don't worry about the other variations. The other scores are similar enough to the FICO score that it shouldn't confuse you. Just keep in mind that they're not all exactly the same.

You should splurge on FICO scores if you're preparing for a major purchase like a mortgage loan and are in the 600-720 range. Consumers in this range are most likely to have their rates impacted by small changes in their score.

Have you been confused by a credit score you ordered being different than a score used by your lender? Share your story in the comments section below.

Emily Davidson – Credit.com's financial expert and former TransUnion credit bureau insider. Emily writes about credit reports, credit cards, loans and personal finance as the CreditBloggers.com editor.

Comments

[Edward B]

My experence with the credit bureaus...

When talking about scores from credit bureaus, I went to Experian and Transunion, paid the extra money to get my score, and they provided me with something called a "Vantagescore". According to the web sites this is a propriatry score that goes from 501-990. When my report came in at 990 I wanted to know how that related to a true FICO score. If it is relative to FICO as they claim, then my FICO should be around 850. The only bureau that will sell you a FICO score is Equifax. I purchased a report from them for $15.00 and my score came back at 777.
I wrote an email to Experian about my concern that their score is NOT relative to FICO, does not provide an accurate ratio or anything else therefore is useless. I have now spent over $25 dollars to realize the only bureau that matters is Equifax. Why should anyone use the others?

I have included the email thread between me and Experian. Please help me understand how they can provide me a score that means nothing to me or the lenders that are evaluating me.

Thanks,

Edward B

--- Original Message ---
From: "Edward B
Received: 7/8/2008 10:02:03 AM Pacific Standard Time (GMT - 7:00 )
To: support.experiandirect
Subject: Credit score question on report number XXX

I just went on line and got my credit report from your bureau and paid the
additional fee for my "Credit Score". When my report with score became
available my score was 990 on the "vantagescore" scale of 501-990.

What does this have to do with the score everyone in the lending community
looks at which is my FICO score? This number is meaningless. If it was
aligned with FICO that means I should have a 850 FICO. I don't. I have a
777.

So what did I pay for?

Since the only score I can get from Experian is some proprietary number that
only means something to you, there is NO REASON for me to ever use any of
your services in the future. Equifax provides true FICO scores. Any future
business will be done with them.
-----Original Message-----
From: James B.

Subject: Re: Credit score question on report number XXX


Dear Edward B

Thank you for writing.

Experian, Equifax and TransUnion jointly developed the credit score offered
by Experian. It is called the VantageScore, and it is a credit score that is
also used by lenders. Just like other credit scores on the market, it uses
credit information to evaluate an individual's credit worthiness or credit
risk.

Think of VantageScore and FICO as just two of the many brand names of credit
scores. In general, credit risk scores have the same purpose, but there are
many brand names available in the marketplace. In fact each of the credit
reporting agencies has spent years developing credit scores which lenders
currently use. The VantageScore is a predictive, accurate score that can
help consumers better understand their credit picture and the factors that
influence it.

Thank you for using ExperianDirect.com.

Sincerely,

Rocyn B.
Customer Care Representative

Regards, --- Original Message ---
From: "Edward B
Received: 7/9/2008 9:54:28 AM Pacific Standard Time (GMT - 7:00 )
To: "'James B.'"
Subject: RE: Credit score question on report number XXX

Dear James,

I completely understand there are several criteria used to evaluate risk of
an individual by lenders, that's fine. And aligning the credit bureaus so
they can provide better consistency in their reporting is truly the ultimate
goal.
That leads directly into my question. If a lender gets a report from
Experian and you provide them my VantageScore number, then the lender gets
my FICO score from Equifax, they are not consistent. My VantageScore
according to the report I downloaded was 990 on a scale of 501-990. My FICO
score I downloaded from Equifax was 777 on a scale that goes to 850.
If I got a 990 from you I should have gotten a 850 from them. If I was a
lender and received these to reports, I would have no confidence in the
report from Experian. It is not realistic and is inconsistent with the other
report.
I am bombarded every day through advertising about how important my credit
score is and as you can see I take it very seriously. But if I can't
understand how VantageScore relates to FICO even as a ratio it is of no
value to me.
That is what I need to understand. How VantageScore and FICO scoring systems
provide a consistent picture of my credit.
It is Experian's responsibility to educate me how VantageScore is just as
accurate in presenting a number that indicates my creditworthiness.

I am all for innovation and improvements in how we manage this very
important and critical part of who we are. If done right it will streamline
the process and reduce costs. Great, but if I don't get it and understand
it, the consumer will remain on the sidelines frustrated as ever.

I look forward to learning more how VantageScore can help me.

Regards,


Edward B
Thank you for writing.

We apologize for any inconvenience. Rest assured that your comments and suggestions will be taken into serious consideration to help us improve our products.

Thank you for your patience.

Sincerely,

Alan B.
Customer Care Representative