Why None of Your Credit Scores are the Same

by Miranda Marquit

Many people are rather surprised when they look at their credit scores and see that they don’t match up. A credit score may differ across different credit bureaus, and those scores are often a little bit different than what you see when you get your free FICO credit score. Sometimes the difference is more than a “little.” In some cases, your might find that your credit scores vary by up to 20 points — or more. Why is this? The answer lies in the fact that credit scoring models differ across agencies and financial institutions.

Two Credit Scoring Models: FICO and VantageScore

Most of us think of FICO when we think of credit scores. Fair Isaac Company pioneered credit scoring as we know it today, coming up with a complex formula to predict borrower behavior based on how credit users have behaved in the past. In order to come up with the FICO score, Fair Isaac Company uses information found in your credit report. But FICO is more than just one score. Indeed, Fair Isaac has a number of different scores that it markets to financial services providers to use when evaluating you. There is a depositor score that rates your banking behaviors, as well as mortgage score that lenders can use to determine your default risk.

VantageScore is another credit score model, this one created by the three major credit agencies. Unlike the FICO score, which ranges from 300 – 850, the VantageScore ranges from 501-990. Additionally, the VantageScore also includes letter rating of A to F. According to the VantageScore web site, this credit scoring model is designed to be a little more friendly toward those who use credit irregularly. The credit agencies claim that the VantageScore, which also gets the data for its scores from credit reports, can help provide an accurate look at those who may be penalized by the FICO score for not using credit as frequently.

Tweaking Credit Scores

One of the reasons that each agency comes up with a different score for you is that not all agencies have the same information reported to them. But, on top of that, each agency tweaks the FICO score as well (except Experian, which does not use the FICO score). But credit agencies aren’t alone in tweaking the formula. Many lenders and insurers have their own ways of emphasizing certain factors more or less in their own scoring models, as well as considering other information.

The result of this is that your credit score can vary widely, depending on what information the institution figuring your score has, and what information is emphasized more in their only variations of credit scoring formulas they use.

More Consumer Information Being Used to Build a Profile

Anymore, lenders and other financial services providers are relying on more than a simple score model. Credit score systems are becoming increasing complex, and some creditors are also striking out on their own to do additional research. The Fed has decided that lenders can use “income estimates” figured by credit bureaus to verify your income, and some lenders actually check what you say about money on your social media profile. On top of that, it is possible for creditors to pinpoint exact purchases made with debit and credit cards.

All of this information has the possibility of being used to construct consumer profiles that can then be used by financial services providers. It is even possible that ever-evolving credit scoring models will begin to take some of this data into consideration.

Published or updated July 12, 2016.
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{ 3 comments… read them below or add one }

1 The Penny Hoarder

I do find it frustrating that the 3 credit bureaus never have the same information and thus different scores. They have created a monopoly out of the industry and yet I’m always surprised at how awful their reliability is.



l find getting a preapproved LSR Letter for a mortgage loan to not be my problem; lt is the final up-front costs which is never refundable to be the catch-22 of the loan process. after the issue of the LSR letter, you find your dream home and 3 days before the closing, the lender rechecks your credit score and lo and behold it has dropped lower than the previous level when your preapproval was made and you have not only lost your home loan, you have lost all the up-front fees and charges made to appraise and inspect the the home. these charges can range from 2,000.00 to 7,000.00 [explain]?.


3 Ryan

Henry, I don’t have a firm answer for you to this question. If you hadn’t made any major changes to your credit profile, then you score shouldn’t have changed enough to change the terms of the mortgage. They should have to provide a reason for the sudden and drastic change in your credit score (for example, opening new lines of credit, missed payments or any of the other factors that may affect your credit score).


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