Most of the credit bureaus deliver two crucial kind of credit score models: FICO Score and Vantage Score. The model will depict credit scores of individuals' ability and financial stability to repay all the credits.
Now let's read further types of credit score more about FICO and VantageScore Models.
FICO Score Model
Firstly, Fair Isaac Corporation took the initiative to develop FICO score model in 1989. A lender's population of 90% use the FICO score, before availing credit.. The FICO score is a three digit number ranging from 300 to 850. Try to maintain 750 and above scores since it is an excellent credit rating. Also, helps in availing personal loans at the minimal rates.
Credit Score As Per FICO Score Model
Score Range Credit Ratings
800 to 850 Exceptional
740 to 799 Very Good
670 to 739 Good
580 to 669 Fair
300 to 579 Poor
Credit Score Calculation By FICO Score Model?
Percentage Credit Factors
35%. Payment History
30%. Amount Owed
15%. Length Of Credit History
10%. Credit MIx
10%. New Credit
VantageScore Model
This VintageScore Model developed, in a collaboration of three major credit bureaus, that is Equifax, Experian, and Trans Union. The VantageScore Model is invented as an substitute to FICO Score model. The most recent and updated version of VantageScore model 3.0 and 4.0 has the similar range of score, same as the FICO score 300 to 850. Also, VantageScore and FICO scores both of them give value to payment of history; however, VantageScore give more importance to aspects like credit utilisation ratio, credit balance and such other aspects from the credit history.
Credit Scores As Per To VantageScore Model
Score Range. Credit Ratings
781 to 850. Excellent
661 to 780. Good
601 to 660. Fair
500 to 600. Poor
300 to 499. Very Poor
VantageScore Model, Calculations Of Credit Scores
Influence. Credit Factors
Extremely Influential. Total credit usage, credits and balance
Highly Influential Credit mix and experience
Moderately Influential Payment history
Less Influential Age of credit history
Less Influential New accounts
Now, that you know about both the types of credit, read further to know main facts that will affect credit scores.
Few Factors Which Affect’s Credit Scores
Credit Inquiries:
Every time an individual applies or check for a loan or any other credit, it is recorded in the system as hard enquiry. So multiple checks can result a decline in credit scores, so dont check or apply often, more than necessary. 10% of credit enquiries is reflected on credit report, in FICO score model.
Length Of Credit History:
This aspect takes up to 15% of FICO score. If the individual has a an history of credits and constent EMI payment record, is more likely going see incline in credit scores.
Thus, these are few of the key effects that individuals have to be careful about.
The Bottom Line:
Credit scores decide applicants approval or rejection. Thus, be careful about availing credit scores in accordance to their requirement. For example pull out credit scores from the Buddy Score, they provide Experian scores, also its an best option if one is in need of personal loans. Buddy Loan provides Buddy Score as a bonus feature in the lenders mobile application and website. Therefore, get credit scores from here, and check your credit worth, before taking personal loans or other credits.
Now let's read further types of credit score more about FICO and VantageScore Models.
FICO Score Model
Firstly, Fair Isaac Corporation took the initiative to develop FICO score model in 1989. A lender's population of 90% use the FICO score, before availing credit.. The FICO score is a three digit number ranging from 300 to 850. Try to maintain 750 and above scores since it is an excellent credit rating. Also, helps in availing personal loans at the minimal rates.
Credit Score As Per FICO Score Model
Score Range Credit Ratings
800 to 850 Exceptional
740 to 799 Very Good
670 to 739 Good
580 to 669 Fair
300 to 579 Poor
Credit Score Calculation By FICO Score Model?
Percentage Credit Factors
35%. Payment History
30%. Amount Owed
15%. Length Of Credit History
10%. Credit MIx
10%. New Credit
VantageScore Model
This VintageScore Model developed, in a collaboration of three major credit bureaus, that is Equifax, Experian, and Trans Union. The VantageScore Model is invented as an substitute to FICO Score model. The most recent and updated version of VantageScore model 3.0 and 4.0 has the similar range of score, same as the FICO score 300 to 850. Also, VantageScore and FICO scores both of them give value to payment of history; however, VantageScore give more importance to aspects like credit utilisation ratio, credit balance and such other aspects from the credit history.
Credit Scores As Per To VantageScore Model
Score Range. Credit Ratings
781 to 850. Excellent
661 to 780. Good
601 to 660. Fair
500 to 600. Poor
300 to 499. Very Poor
VantageScore Model, Calculations Of Credit Scores
Influence. Credit Factors
Extremely Influential. Total credit usage, credits and balance
Highly Influential Credit mix and experience
Moderately Influential Payment history
Less Influential Age of credit history
Less Influential New accounts
Now, that you know about both the types of credit, read further to know main facts that will affect credit scores.
Few Factors Which Affect’s Credit Scores
Credit Inquiries:
Every time an individual applies or check for a loan or any other credit, it is recorded in the system as hard enquiry. So multiple checks can result a decline in credit scores, so dont check or apply often, more than necessary. 10% of credit enquiries is reflected on credit report, in FICO score model.
Length Of Credit History:
This aspect takes up to 15% of FICO score. If the individual has a an history of credits and constent EMI payment record, is more likely going see incline in credit scores.
Thus, these are few of the key effects that individuals have to be careful about.
The Bottom Line:
Credit scores decide applicants approval or rejection. Thus, be careful about availing credit scores in accordance to their requirement. For example pull out credit scores from the Buddy Score, they provide Experian scores, also its an best option if one is in need of personal loans. Buddy Loan provides Buddy Score as a bonus feature in the lenders mobile application and website. Therefore, get credit scores from here, and check your credit worth, before taking personal loans or other credits.