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FICO scores are credit scores, but not all credit scores are FICO scores. Sounds like one of those confusing logic puzzles, right? But it’s a basic must-know when it comes to understanding credit scores.

There are many different credit scoring models and FICO is a company that actually provides several different versions to lenders. In fact, you may be surprised to find you have more than one FICO score. FICO released FICO 9 in 2014, the ninth generation and most recent version of its FICO credit scoring model. But — and this is a big but — that doesn’t mean that the FICO score you get every month from your credit card company is FICO 9. Lenders who use FICO scores to make their decisions may use FICO 8 or FICO 7 or even a custom FICO score they’ve asked the company to create just for their needs.  For example, an auto lender may want to weigh borrowers’ car payment histories more heavily in a custom scoring model.

So Is FICO the Best?

Are there credit scores that are better or worse than one another? It depends on who you ask. Of course, a credit scoring company, whether it’s FICO, VantageScore or another competitor, will generally tout that they have the best credit scores, citing their ability to predict consumer defaults and delinquencies accurately and how widely they’re used by lenders. A consumer, however, might be perturbed by one credit scoring model’s decision to count a paid medical collection account on their credit report, for example, and prefer a score that doesn’t ding them for that mark on their credit. Lenders may say that they’re using the best credit score if that allows them to make money without taking on too much risk.

It’s important to note that consumers don’t get to pick which credit score a lender uses when reviewing an application. In fact, many lenders don’t even tell you which score they’re using to make the decision or which credit bureau’s report they’ve pulled for you. That’s why it’s important to make sure your reports are accurate and that you’re focusing on the basics of what builds a good credit score.

First, you need to understand the data points that comprise your credit score and that can be easily found on your credit reports. You are entitled to a free annual credit report (here’s how to get yours) from each of the major credit reporting agencies. You need to know what is on those reports so you can better understand your credit scores, especially since there can be errors on your credit reports that might be unfairly hurting your scores.

The Basics of Good Credit

The vast majority of credit scoring models revolve around five basic factors:

  • Payment History
  • Amounts Currently Owed
  • Length of Credit History
  • Types of Credit
  • Searches for New Credit

You can check your free credit report card on Credit.com to see what your grade is on those five factors (it can help you make sense of those credit reports you’ve just pulled) and get a look at two of your credit scores for free as well. Focusing on improving in these major areas can help you improve all of your scores over-time.


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