Many consumers are aware that they have a FICO score, a scoring model used by most banks and lenders to rate their use of credit and debt issued that’s been issued by the Fair Isaac Corporation since 1989. But far too few realize there are different versions of FICO scores, and not all banks and lenders use the latest versions, and in fact, most still use versions that are considered ancient considering that FICO 8 has now been rolled out.
It is important to realize that not all scores, including FICO scores, are created equal.
Creditors and lenders use more specific industry credit scores that are customized for the type of credit-product you’re applying for. For example, auto lenders typically use a credit score that better predict the likelihood that you would default on an auto loan. Mortgage lenders use a score developed specifically for mortgage loans. Or, your credit or lender might also use a proprietary credit score that’s developed for use by just that company.
Below are examples of the different versions:
Be aware – don’t confuse your FICO Scores with “educational” scores.
A common question we receive at Blue Water Credit is:
“Why does TransUnion say my credit score is 724 when the lender report says that my Trans Union FICO is 689? Both credit reports contain the same information and were pulled on the same day.”
The reason you’re seeing a discrepancy is because these scores are from two different scoring systems. The score bought from TransUnion is their consumer version of the credit score, but it’s not your FICO score. Many different websites sell credit scores to consumers, but only lenders have direct consumer access to FICO scores.
In fact, you may be surprised to know just how many different credit scores are sold to consumers – most of which are never used by lenders. Examples include:
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Credit Karma™
Quizzle Credit Sesame Identity Guard® National Credit Report |
TrueCredit.com™
Experian® Equifax® Trans Union® freecreditscore.com™ |
ID Watchdog™
LifeLock®Plus many more! |
This is not to say that getting your credit scores from online vendors is a bad idea. Checking your credit scores from a trusted seller can often serve as a guide for pointing you in the right direction. If you pull your credit score from a reputable source and find that you have a very high score, then more often than not, you’ll have a good FICO score as well. Just be sure to check your actual FICO score from a trusted professional before applying for a loan – this is the best way for you to know what the lenders will base their terms on.
