What is Credit Score?

The credit score is the representation of your ability to repay a loan and make on-time payments that range from 300 to 850. The majority of customers have credit scores ranging from 600 to 750. Creditors may be more confident in your ability to repay future loans if your score is higher. A borrower’s credit score improves the way they appear to potential lenders.

A 700 or above credit score is considered good and may result in a cheaper interest rate for the borrower. But when reviewing consumers for loans and credit cards, creditors may create their own criteria for what they perceive to be excellent or unfavorable credit ratings.

There are important differences between FICO and VantageScore that you should be aware of.

The two famous scoring model’s FICO and VantageScore, aren’t the only ones available. Lenders use different scoring methods known in the market to determine your creditworthiness and make their financial decisions.
90 percent of leading lenders use FICO scores to make loan decisions today, but FICO’s market dominance has been challenged by a newcomer named VantageScore in the last decade or so. Let’s look at some of the differences between the two models and why they could be vital to you.


The FICO score was developed in 1980 by Fair, Isaac & Co., a firm founded in 1956 and was originally known as Fair, Isaac & Co. FICO is a prominent analytics software firm that assists companies in more than 90 countries in making better decisions that lead to increased growth, profitability, and customer satisfaction.

VantageScore was established in 2006 by the top 3 Credit Bureaus (Equifax, Experian, and TransUnion), offering market competition, building highly accurate credit scoring models, and reliably assessing more individuals they may obtain access to mainstream credit.

VantageScore vs. FICO Credit Scores Minimum Scoring Requirements

A credit score is not available to everyone. To be qualified for VantageScore and FICO Credit Scores, your credit report must first meet the minimum requirements for their scoring model.

For FICO, in order for you to get a legitimate score, your credit report must contain at least one account active for 6 months or longer, at least one account that has been reported to the credit agency during the last six months, and no indication of deceased on the credit report.

If you don’t have a lot of credit history, VantageScore is the number to keep an eye on. Because VantageScore allows for shorter credit history and a longer reporting period. VantageScore may be able to give you a valid credit score if your credit record has at least one account, even if it is less than six months old.

VantageScore vs. FICO hard inquiries treatment

You’ve probably known that opening too many credit cards in a short period of time isn’t a good idea. One reason for this is because when you apply for a credit card, the lender performs a “hard inquiry” to determine your creditworthiness. Hard inquiries recorded on your credit report can potentially lower your credit score. It is important for you to understand when they can occur, how they affect you, and why it’s better to avoid them.

For FICO, their newer versions count numerous credit inquiries of the same kind within a 45-day period as a single inquiry to reduce the impact of credit shopping on your scores. For earlier versions, the duration of a single inquiry might be up to 14 days.

For VantageScore, if several hard inquiries occur within a 14-day timeframe, they will be interpreted as a single inquiry.

Bottom Line

There are several distinctions between VantageScore and FICO credit score and the credit scoring methods used by each lender company.

Consumers and businesses benefit from competition among credit score providers since they continually improve their models to better forecast a borrower’s creditworthiness.