Which FICO Scores Do Lenders Use? - Investopedia

If you’ve applied for a credit card, mortgage, or car loan, you probably know that you have a FICO score. However, what you may not realize is that you likely have more than one FICO score—possibly dozens of them. That’s because lenders look at different versions and types of FICO scores depending on the type of credit you’re seeking and other issues. Let’s explore the range of FICO scores and which lenders use them.

Key Takeaways

FICO credit scores are used by most lenders to evaluate a borrower’s creditworthiness.
The FICO scoring methodology has been updated over the years, and lenders can choose which version to use.
Industry-specific FICO scores are also available for different types of credit, such as mortgages, car loans, and credit cards.

What Are FICO Scores?

FICO scores are credit scores that were developed by the Fair Isaac Corporation (now called FICO). Used by more than 90% of lenders, according to the company, the scores are designed to help assess a borrower’s creditworthiness. FICO considers five factors when calculating a score:

Payment History (35%)
Amounts Owed (30%)
Length of Credit History (15%)
New Credit (10%)
Credit Mix (10%)

Why Are There Different FICO Scores?

When you apply for credit, whether it’s your first credit card or a second mortgage, lenders need to decide whether you’re creditworthy enough and likely to repay the money. To do this they check your credit scores or get credit reports from one or more of the major credit bureaus: Equifax, Experian, and TransUnion. Each has its own credit score that is developed by FICO, and these scores are calculated based on your credit history and other information that goes into your credit report.

There are also multiple versions of FICO scores, reflecting the evolution of the credit market and consumer behavior since the scores first became a tool for lenders back in 1989. Just in terms of the amount of credit we use, there’s been a big increase over the past few decades, with consumer borrowing rising by approximately 15% over the last four years. A typical borrower today probably would have been considered a higher credit risk under older methods of calculating credit scores.

FICO has rolled out 10 versions of its “base” score over the years, and most of them are still in use by lenders to some extent. Lenders can choose from the following base versions:

FICO 2
FICO 3
FICO 4
FICO 5
FICO 8
FICO 9
FICO 10 and 10T

The FICO 10 Suite, which lenders started having access to in 2020, introduced more flexibility and predictability into the scoring model to help lenders avoid the risk of defaults by borrowers. A number of lenders have switched to FICO 9, which is more forgiving of unpaid medical bills, but FICO 8 remains the most widely used.

Finally, depending on the type of credit that’s being requested, lenders may also decide to use one of the many industry-specific scores that FICO has developed. While the base FICO scores look at how likely borrowers are to repay debt, scores for specific types of credit would take into account payment history and risk behaviors that might be more relevant to that market. For example, if a borrower has missed payments on a car loan in the past, that could have an impact on their FICO Auto Score.

Another difference between base FICO versions and industry-specific ones is the range of scores you can get. FICO scores on the base versions can be anywhere between 300 and 850, with anything above 670 generally considered “good” credit. Meanwhile, industry-specific scores, such as the FICO Bankcard Score for credit cards and the Auto Score for car loans, have a wider range of 250 to 900.

Which Lenders Use Which FICO Scores?

With the exception of the mortgage market, which is heavily regulated, lenders can generally choose which FICO score they use when doing a credit check. However, they tend to use certain versions depending on the kind of credit for which you’re applying. Here’s a look at the most common FICO scores used for each type of credit.

Mortgages

When you’re taking out a mortgage, there’s a good chance that the loan will end up being bought by Fannie Mae or Freddie Mac. As with many other aspects of the housing market, these massive government-backed mortgage companies dictate which FICO scores can be used by home lenders. Here are the FICO scores used in credit reports generated by the three credit bureaus (as well as the alternative names the bureaus use to advertise them):

Experian: FICO Score 2 (Experian/Fair Isaac Risk Model V2SM)
Equifax: FICO Score 5 (Equifax Beacon 5.0)
TransUnion: FICO Score 4 (TransUnion FICO Risk Score, Classic 04)

Car Loans

While FICO has created several auto-specific scores, the base FICO 8 and 9 scores are still widely used in car lending. Here are the various FICO auto scores available, as well as which ones credit bureaus tend to use:

FICO Auto Score 2 (Experian)
FICO Auto Score 5 (Equifax)
FICO Auto Score 4 (TransUnion)
FICO Auto Score 8 (Experian, Equifax, TransUnion)
FICO Auto Score 9

Credit Cards

Just as with auto loans, FICO has developed a series of scores attuned to the concerns of credit card issuers. These FICO bankcard scores are more sensitive to how a borrower has managed their credit cards in the past. Here are the available FICO Bankcard Scores and the credit bureaus that use them:

FICO Bankcard Score 2 (Experian)
FICO Bankcard Score 4 (TransUnion)
FICO Bankcard Score 5 (Equifax)
FICO Bankcard Score 8 (Experian, Equifax, TransUnion)
FICO Bankcard Score 9

The Bottom Line

You may never know which FICO score a lender enlists when considering your credit application. Still, regardless of what methodology is applied, the essentials for earning a good score still apply:

Make your monthly payments on time
Don’t open more credit accounts than you need
Keep debt balances down

You can also check your FICO 8 and FICO 9 credit scores through FICO for a fee, or you might be able to access your scores for free from your bank or credit card company.

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