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Check your VantageScore too
VantageScore was launched by the three prime credit bureaus as a competitive alternative to FICO and it's fast gaining acceptance among financial institutions. Ergo, now you need to check your VantageScore as well, along with your FICO score.
Let's face it, most Americans live on credit. Naturally, they often resort to taking loans at lower interest rates, to reduce their financial burden. This is exactly when credit scores, credit history, and related reports come into play. No loan application is approved before a detailed analysis of the applicant's creditworthiness, which is quantified through credit scores and reports. So, what are good credit scores and when do you say you have a doomed credit report? Why are lenders so obsessed with this score? Let us find out answers to all these questions in the following lines. We introduce you to VantageScore and FICO credit scores, their scales, and determinant factors, as well as charts that will provide you with an indication of how your personal score will be perceived by lenders.

Credit Score Granting Bureaus

Technically speaking, the credit score is a statistical technique of determining the probability of an individual repaying his debt within a specific period of time, by evaluating and analyzing his previous credit history. In simple words, it is a numerical expression of your creditworthiness. Credit scores are granted by three bureaus in the US namely, Experian, TransUnion, and Equifax. These scores are formulated on the basis of a software program developed by Fair Isaac Corporation (FICO), hence also termed as FICO scores. VantageScore has been jointly developed by these bureaus and uses a different type of algorithm.

The evaluation is based upon the credit data of an individual, available with the credit bureaus. It is possible that the three bureaus have different credit reports regarding the same individual. Hence, he actually has three different credit scores. Nonetheless, the variation in the score range is not significant enough to influence the financial fate of a person.

FICO Credit Score Scale Chart

The FICO scale ranges between 300 to 850, as a measure of an individual's creditworthiness.

FICO Credit ScoreRating
> 720Excellent
680 to 719Good
620 to 679Average
580 - 619Poor
500 - 579Bad
< 500Miserable

Credit score chart

Credit Score Range Evaluation


As evident from the table above, excellent credit scores assure best prospects of getting a loan; that too at lower interests. Most money lenders will find it difficult to reject a loan applicant with a superior score. People with scores in the range of 720 to 850 will not have any difficulty getting loans at desired interest rates, provided other conditions are met.

Generally, any loan application with a credit score of 720 and above is treated in a similar fashion by the lenders. While a credit score beyond 800 is indeed splendid, it may not earn you extra points with the lenders. Your loan application will be reviewed in the same way as the one with a credit score of 720 or above.

Scores below 680 are considered risky and although there is no problem acquiring a loan, you may have to bear higher interest rates. People in the range of 580 to 619 may find it difficult to get loans and even if they do, the interest rates will be very high. People who have very poor scores should work upon credit repair before they can hope to get a loan sanctioned. In short, people with credit scores in the range, good to excellent, have no reason to worry, while those below, should look for ways to improve scores.

Determinants of a FICO Credit Score

Credit score determinants

Although, FICO has its own formula for evaluating the score, its variables are based upon certain factors. These factors and their corresponding weightages in deciding your score, are as follows:
  • Payment history (35%)
  • Outstanding current debts (30%)
  • Length of credit history (15%)
  • Types of credit accounts owned (10%)
  • New credit applications (10%)
VantageScore Rating Scale

As an alternative model to FICO's rating, VantageScore has been developed through collaboration, between TransUnion, Equifax, and Experian. It is based on a different algorithm, that has been constantly evolving to offer the most accurate picture of your creditworthiness. The current version 3.0 of the algorithm has been recalibrated to provide a rating scale ranging from 300 to 850, it being a familiar numerical scale.

Most importantly, this score considers individuals who have a credit usage history of less than six months, for whom traditional evaluators like FICO do not provide a score. Some of the other few features of the score include the exclusion of negatively-impacting debt collection accounts, from the calculations, provided they are paid off, as well as credit relief for victims of natural disasters. Four of the top 5 mortgage lenders, 6 of the top 10 credit card issuers, 4 of the top 10 auto loan lenders, and 7 out of the top 10 financial institutions now accept VantageScore to verify an individual applicant's creditworthiness. Here is a ratings chart that illuminates the perception of lenders about your VantageScore.

Credit ScoreRating
721―850Super Prime/Excellent
661―720Prime/Good
601―660Nonprime/Average
500―600Subprime/Bad
300-499Deep Subprime/Very Bad


The determinant factors in case of VantageScore are an individual's bill payment history (the most important factor), type, and age of utilized credit, percentage of credit limit utilized, total debt, total available credit, and recent inquiries about credit, as well as related behavior.

Analyze your FICO as well as VantageScore before applying for loans as it will give you a fair idea about what you can expect from the lenders. Paying your bills on time and utilizing your credit lines intelligently, will see to it that your creditworthiness is positively reflected in the score.