Are all Free Credit Scores Created Equal?


Gone are the days that credit scores are available only for a price. There are many free credit scores available today to the consumer but the sources of the score and the scoring models used to create them are all different. Some question the value of free scores as lenders will invariably use another scoring system when evaluating potential customers. The scores consumers receive for free are a version of the FICO score or the Vantage score. What are the differences in these scores and are they different from what lenders use?

The FICO Score

FICO scores are the gold standard of lenders; FICO (Fair Isaac Corporation) proclaims that 90 percent of lenders use their scoring system. There have been eight versions of the FICO score released, some despite their age, are still being used today. FICO 98, released in 1998, is still used by some lenders for lending decisions and given away for free by others. Currently, there are 65 different types of FICO scores in circulation, counting the 12 new scores introduced with the latest release of the FICO score, FICO 9.

The published range of the FICO score is 300 – 850, but in the real world, varies from model to model.

Scoring Factors

The FICO score weights different aspects of your credit report:

  1. Payment history (35% of score),
  2. Credit utilization (30% of score),
  3. Age of accounts (15% of score),
  4. New credit (10% of score),
  5. Types of credit being used (10% of score).

In addition to the weighting aspects of your score, FICO has “buckets”, or starting score categories. You are placed into a bucket, and then weighting factors are applied. This makes sure, for example, that a person with a bankruptcy always scores lower than those without them. Some examples of buckets are the aforementioned bankruptcy bucket, serious delinquency buckets, and buckets based on the age of the credit file, or number of accounts. FICO 98 does not use buckets.

Differences in Scoring Models

If you get a free FICO score you will get one of three kinds: the FICO 98 score, the FICO 04 score (introduced in 2004), the FICO 08 score (introduced in 2008).


Differing from FICO 98, FICO 04 introduced buckets into their scoring models and also changed the way inquiries are duplicated for multiples pulls in a short period of time for autos loans and mortgages. FICO 04 also penalizes late pays a little more heavily then their predecessors. They also have the ability to weight the amount charged on no preset spending limit credit cards and instead of grading HELOCs like revolving credit cards, are able to treat them as mortgages.


FICO 8 is more lenient toward the rare missed payment and ignores small debts in collections and public record items that have an original balance of less than $100. It also more heavily penalizes the higher credit utilization rates. FICO 08 also removes the influence of authorized user accounts if there isn’t a primary relationship with the cardholder like husband and wife. The FICO 8 model also allows people to score with a perfect 850 score, differing from previous models.

The Vantage Score

Credit scoring is big business; FICO made $748.99 million dollars in revenue in 2014 (per Wikipedia). FICO has an interesting relationship with the three credit bureaus. FICO uses the data of the credit bureau’s databases and is dependent on them for the data to create FICO scores, yet the credit bureaus compete with FICO on credit scores in the form of the VantageScore. VantageScore Solutions, the entity created jointly by the credit bureaus to administer and develop VantageScores claims that 2000 lenders use the VantageScore to make lending decisions. There have been 3 major versions of the VantageScore; VantageScore 3.0 is the version you will get if you get your free VantageScore.

The VantageScore weights the information in your credit score differently than FICO:

  • 32% payment history
  • 23% credit utilization (amount of credit used/divided by credit limit)
  • 5% balances
  • 13% depth of credit
  • 10% recent credit
  • 7% available credit

The scoring range of the VantageScore (3.0 model) is 300 – 850.

Some other differences between FICO and the VantageScore:

  • Unlike the FICO score, paid collections do not count against you (Vantage 3.0 scoring model).
  • With the FICO scoring model, data must be at least a year old to count in the scoring calculation. The VantageScore can score consumers with only 6 months of data.

The Difference in Credit Bureaus

The underlying data used to calculate a credit score is the data from whichever credit bureau it uses. The 3 main credit bureaus, Experian, Equifax and TransUnion, do not share information, they are each for-profit companies that have different arrangements with their information furnishers (the financial institutions and public records agencies that supply the data in the reports). It costs money to report to a credit bureau, not all financial institutions report to all 3 bureaus. If you get a FICO score from TransUnion, it will be different (sometimes dramatically so) from a FICO score based on the information from another bureau. VantageScores are no different, it matters which bureau is the underlying data source – they can be vastly different. Getting a free credit score implicitly means that you are not receiving a score from each of the credit bureaus; only one is given out from one of the bureaus, which is an incomplete picture of your overall credit standing.

Where to get Your Free Credit Score

In November 2013, FICO announced they would allow any lender using FICO scores to make the scores available to consumers for free using the FICO Score Open Access program. Some credit card issuers immediately jumped on the bandwagon: Barclaycard US and First Bankcard (First National Bank of Omaha) were the first to sign on. Other card issuers who have since begun to give out scores are Discover, the Walmart card, Bank of America, Chase, Citibank (who gives out the Equifax score).    If you get your credit score from a credit card issuer, most likely you will be getting your TransUnion FICO 8 credit score.

Banks Giving Out Credit Scores

  • Wells Fargo gives out Experian’s VantageScore for 90 days through promotional programs.
  • PenFed provides free FICO NextGen scores online to credit card holders and members with active checking accounts or installment loans
  • USAA provides free Experian VantageScores to members.
  • US Bank provides free Experian credit scores to customers.
  • Ally will begin giving out your free TransUnion FICO score.

Free Websites

There are several websites that offer up your free VantageScore in exchange for your agreeing to let them market your personal information:

  • CreditKarma (which uses the TransUnion and Equifax VantageScores),
  • CreditSesame (which uses the Experian VantageScore),
  • Quizzle (Experian Vantage credit score),
  • (own version of credit score; uses Experian data).

Does Your Free Score Match Up to What Lenders Use?

Most lenders use the FICO scoring model over the VantageScore. In addition, the credit scores given out to consumers are only a generalized risk score, and not tailored to the type of credit for which you have applied. Lenders do not use generalized risk scores, the versions they use are specific to the type of credit being sought by a consumer. Both FICO and VantageScore Solutions makes tailored versions of the credit scores they sell to lenders, for auto loans, credit cards, etc. The FICO score or VantageScore your lender uses is absolutely different than the general risk score you’ve received elsewhere.

Don’t expect the lender to use the latest and greatest version of the scoring models available to them. Just as some corporations are still using old versions of Windows as their IT desktop computer operating system of choice, lenders are slow to adapt to new scoring models and stick to models that are years out of date. Despite the fact that FICO 8 has been around since 2008, many lenders have not yet adapted to this newer version; many still use FICO 04. It gets worse. Some mortgage lenders are even using the FICO 98 version of the FICO score.

If I Buy My Score, Will I Get a More Accurate One?

Paying for your score will still not give you the same score used by lenders to whom you submit an application. If you buy your score from any of the three credit bureaus, you will get the VantageScore 3.0 version of your score; the majority of lenders use FICO scoring models. If you buy your score from, you will get your FICO 08 score, and your FICO mortgage score from each of the bureaus; your lender will use a different version. If you get your score via with the “3 report view”, or the “free” once yearly score available with the purchase of credit monitoring, or single Experian report, you will get the FICO 98 version of your Experian score.

Posted in Credit Score
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