The VantageScore 3.0 Model & How It Works

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You’ve heard that your credit score is important. But did you know that you actually have several different versions of a credit score? Or that there are different models (or calculations) for scoring your credit? Here, we’ll take a look at your VantageScore 3.0.

Why you need to know about the VantageScore 3.0 model

VantageScore 3.0 is a consumer credit score — essentially a competitor of the popular FICO Score. A number of people and businesses use the VantageScore credit scoring model, including lenders, landlords, credit card companies, financial institutions, and more. Your credit can be pulled for many reasons, but here are some of the most common:

  • Applying for a loan
  • Applying for a credit card
  • Applying for a new job*
  • Trying to buy a new car
  • Trying to buy a new house
  • Trying to rent an apartment

* There are states that are now prohibiting employers from checking prospective and current employees credit. For more information please visit our article on this topic.

Credit scoring models were created by the major credit bureaus to predict the likelihood that you will repay any money you borrow. The VantageScore algorithm was developed in 2006 to compete against FICO. Initially, the model followed a different scale than FICO, but the companies that created it, realized they were fighting an uphill battle and has since adjusted their scoring model to reflect a similar scoring range as the FICO Score.

More than 6 billion VantageScore credit reports were used by lenders in 2017, and more than 1 billion went directly to consumers.

Why is VantageScore 3.0 Important?

While it may seem like just another random number to keep track of, your credit score is actually anything but. In fact, your credit score is a number that has a big impact on your financial life and health. You need credit for a number of things: buying a new car, renting an apartment, buying a home, applying for a line of credit, and more. Employers in all but 10 states can even run a credit check in the final interview stages, before extending a job offer. What’s more, did you know that your credit score can actually impact the outcome of each of the scenarios mentioned?

While the number of VantageScore requests decreased from 2015 to 2016, as you can see, it is still a very viable credit scoring model and one that is widely used.

Number of VantageScore Requests Annually

YearVantageScore Request by Lenders
July 2014 to July 20158 Billion Requests
July 2015 to July 20166 Billion Requests

Source: Data found October 5, 2018. Your VantageScore website. (2017) VantageScore 4.0 Overview. (PDF file.) Retrieved from VantageScore 4.0 Overview. (2017). 1st ed. [ebook] VantageScore, p.4. Available at:
https://your.vantagescore.com/images/resources/VS4%20Overview%20WP%20-%20FNL.pdf [Accessed 3 Oct. 2018].

Learning about your VantageScore 3.0

Let’s take a closer look at VantageScore 3.0 — what matters most for VantageScore 3.0, the various factors that affect your score, VantageScore scoring range, how to get your VantageScore, VantageScore vs. FICO Score, and more.

What matters most for VantageScore 3.0

Unlike your FICO score, VantageScore prefers to stay away from exact percentages when it comes to the weight of factors in determining the score. Rather, it describes factors in terms of their influence — for instance, payment history is extremely influential, while recent credit behavior and debt are less influential. But in order to better understand the score, we will look at the percentage weight that VantageScore has used in the past.

The factors that matter the most are the same for both FICO Scores and Vantage Scores, so the best thing consumers can do to help increase and maintain their score is to pay all of their bills on time.

VantageScore 3.0 Weights and Factors

VantageScore FactorsEstimated Percentages
Payment history41%
Credit age & variety20%
Credit use20%
Recent credit applications6%
Available credit2%

Source: Data found October 3, 2018. Your VantageScore website. (2017) VantageScore 4.0 Overview. (PDF file.) Retrieved from VantageScore 4.0 Overview. (2017). 1st ed. [ebook] VantageScore, p.4. Available at:
https://your.vantagescore.com/images/resources/VS4%20Overview%20WP%20-%20FNL.pdf [Accessed 3 Oct. 2018].

TransUnion VantageScore Range

For the purpose of this article, we’re going to explain your TransUnion VantageScore range. As you can see below, VantageScore scores can range from 300 to 850 — similar to FICO Scores. Also like FICO Scores, the higher your score, the better your credit. But rather than add labels or classifications such as “Good,” “Fair,” or “Poor,” TransUnion takes it a step further and assigns a credit score rank, A through F, to your score. Think back to school — an A represents the best credit, and it goes down from there.

VantageScore has a proprietary formula that is applied to the data and info in your credit report. Often, each bureau will have a slightly different mix of data, because not all creditors report all of your activity to each bureau. VantageScore has announced a new algorithm, VantageScore 4.0, that is currently being tested by credit bureaus. It will treat medical debt differently and more leniently than the current algorithm, so it will bring a new update to how your data is approached.

VantageScore Credit Report Scoring Range

Transunion Credit Score RanksVantageScore 3.0National Vantage Score Averages in Each Rank
A781 to 85074% to 100%
B720 to 78052% to 73%
C658 to 71935% to 51%
D601 to 65722% to 34%
F300 to 6001% to 21%

Source: Data found October 4, 2018. Transunion website. What is a good credit score range with TransUnion?. Retrieved from https://www.transunion.com/article/what-is-a-good-credit-score

VantageScore vs. FICO Score

There are several key differences between VantageScore and FICO Score:

Vantage Score takes less time to establish (a VantageScore can typically be produced in 1-2 months of a consumer opening an account, FICO takes 6 months)

VantageScore also takes into consideration recurring monthly payments (rent, utilities, etc) so some consumers who can’t be scored by the FICO model can still get a VantageScore

VantageScore ignores paid collections
VantageScore weighs late mortgage payments more heavily than other late payments (this can be good or bad, depending on your habits)
VantageScore makes allowances for consumers impacted and affected by natural disasters

Here’s a quick glance at the average VantageScore vs. the average FICO Score by generation.

Average FICO Score Versus VantageScore Subdivided By Generation

Age GroupAverage VantageScore Average FICO Score
Millennials40% Received a
C Score or Above 719+
41% Received a
Good Score: 670+
Generation X48% Received a
C Score or Above 719+
50% Received a
Good Score: 670+
Baby Boomers54% Received a
C Score or Above 719+
52% Received a
Good Score: 670+
Silent Generation58% Received a
C Score or Above 719+
59% Received a
Good Score: 670+

Source: Credit Sesame surveyed 500 Americans on their Vantage Scores. 100 are in Generation Z age range, 100 participants are Millennials, 100 respondents are included in the Generation X age range, 100 participants are Baby Boomers, and 100 participants are members of the Silent Generation age range. This study was conducted November 2016 over a period of three weeks.

Benefits of learning about VantageScore 3.0

As we mentioned earlier, your credit health plays a tremendous role in your life. Having good credit can not only make your life easier — it can save you significant amounts of money in the process. The first step to taking control of your credit is to check your credit report and understand your credit score, as well as what it can impact and how it can benefit you. And, while the FICO Score model is well known, it is important to note that VantageScore is just as effective for long-term tracking of your overall credit score.

Savvy consumers will also use the difference in scoring models to their advantage. Since each model weights various factors differently, your score may be slightly higher with one model over the other. Once you know which model offers you a better score, you can use this to your advantage. For instance, let’s say that you have a better VantageScore and you’re applying for a mortgage loan. Bank A uses the FICO model for scoring, but Bank B uses VantageScore — making Bank B the likely better choice.

But don’t just take our word for it. We spoke with Credit Sesame member, Eleanor, to find out why she checks both her VantageScore AND FICO Scores.

Why Eleanor S. checked both her FICO and VantageScores

Member Since: 5-4-2016

b>Source Information (Interviewee)b>
We interviewed Eleanor S. on December 18, 2016; she earns $109,000 a year is 48 years old and lives in Santa Monica, Calif. She is single and doesn’t have kids and is currently working as a television producer.

You’re among the population who check both your FICO and VantageScore, why did you elect to check both numbers?
I’ve always been fastidious with my finances, but a few months ago our company experienced an unfortunate data breach. I used my work computer to move money around from time to time and my financial account passwords were among the data mined by the hack.

Of course, I changed all my details and updated my passwords, but thieves are clever today. So, I decided to pay the fee to check both scores. I was lucky I changed all my information because one of the stage hand’s credit cards was maxed out overnight due to fraudulent activity.
b>Was there a difference in your scores?b>
Not really, my VantageScore was lower (B Score 778) than my FICO Score (Very Good Score 784). I figure the scales vary a little, but overall were so close to one another there was no reason for alarm or further investigation.

Eleanor’s story reminds us that it’s important to check all your reports and scores periodically, as you never know if there is inaccurate information. What’s more, it’s a reminder that —while your scores may not differ too much— they are, in fact, calculated differently and can vary from bureau to bureau. This information can be helpful when you’re applying for new credit.

Let’s say you know your mortgage company pulls your Experian report, but that’s your lowest score. Maybe you wait for 30-days and try to improve the score before you apply or you get a rate quote from a different lender who pulls reports from the bureau that is associated with your highest score. Because there are so many different scores, and lenders are not required to use one over another, it pays to find out which score they will be using in advance. That way you can be prepared.

Why the VantageScore 3.0 model matters

To quickly recap, VantageScore 3.0 is simply a model used to score your credit. There are slight differences between VantageScore and FICO, including the factors that contribute to your score and the weight they represent.

Regardless of what score you’re looking at, the strategies are the same to improve your credit. Make your payments on time, keep your credit utilization down, limit your applications for new lines of credit — and you’ll start to see your score improve in no time.

Claire Tak
Claire is a content expert, personal finance enthusiast and travel fanatic. You can find her travel shenanigans on ClairesHoliday.com.

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