What’s the difference between various FICO score versions?

If you’ve been working to stay on top of your credit score, you’ve probably done your research and found that FICO scores are commonly used in lending decisions.

A FICO score is a three-digit number ranging from 300 to 850 that offers lenders and credit card issuers a glimpse into your creditworthiness. If you’ve been a responsible borrower — with little or no missed payments, low overall debt and a long, diverse credit history — you’re likely to have a good-to-excellent score of 661 or above. If your credit history is troubled, your score might fall below 661 or even land in the “poor” range of 579 and under. Your FICO score is based on information in your credit report — primarily credit card and installment loan account activity.

Over 90 percent of top U.S. lenders use FICO scores. Yet, there is not just one single version. In fact, there are multiple variations, which means you also have many different FICO scores.

Read on to learn about different FICO versions and how they’re used by lenders.

Why are there multiple FICO score versions?

The first broad-based credit bureau scores were introduced by FICO more than 30 years ago, helping to expand access to credit in a trusted, responsible and objective manner. Needless to say, a lot has evolved since the FICO scores were first introduced, from the role of consumer credit in this U.S. economy to evolving consumer credit practices and behaviors to enhanced modeling tools and new data.

Not to mention, different types of lenders base their decisions on varying degrees of the five factors that make up the common FICO score blueprint. What matters to a mortgage lender might not be as crucial to a credit card issuer, while a bank issuing you a car loan might be interested in some other aspects of your financial behavior.

This has resulted in multiple FICO scoring versions being supported in the market that address various lender and consumer needs. Each lender determines which version it will use when evaluating a request for credit.

“Very similar to an iPhone analogy where Apple releases a new version of iPhone, you may say, ‘I need this, and those new features are really important to me,’ whereas I would say, ‘I don’t really need that, I’m okay with my current version,’” explains Tom Quinn, vice president at FICO. “So, Apple has multiple versions being used by consumers and being supported. It’s a similar phenomenon with FICO Scores — we have lenders using different versions of the score depending on their needs.”

Let’s dig into these versions and see what type of lenders use them.

FICO 8

FICO 8 is the most widely used FICO score version across the three credit bureaus — Experian, Equifax and TransUnion. Whether you’re applying for a personal or student loan or a retail credit card, knowing your FICO 8 score can help you evaluate your approval chances.

All FICO score versions are based on the following categories of information:

• Your payment history (35 percent of the score)
• Amounts owed (30 percent of the score)
• Length of credit history (15 percent of the score)
• New credit (10 percent of the score)
• Credit mix (10 percent of the score)

While FICO 8 is the most widely used, newer versions of the score are available. For example, many lenders have upgraded to FICO 9. Unlike older versions, FICO 9 ignores paid third-party collections, places less weight on unpaid medical collections and factors in rental history when reported.

The newest variation, FICO 10T, is the first version to also consider trended credit bureau data. This offers lenders a more predictive score as it considers a deeper evaluation of how you’ve managed your accounts over the past 24 months, such as your balances, how much you’ve paid on your recent credit card statements over time and whether you’re increasing, maintaining or reducing your debt over time.

Knowing these differences can help you be better prepared when you apply for credit. For instance, if the lender is using FICO 9, you might not need to worry about that paid collection account on your credit report.

Industry-specific scores

In addition to the base versions, there are industry-specific FICO scores designed to help lenders better assess risk for specific types of credit products. According to Quinn, they work as sort of an “overlay” on your base FICO score, refining risk prediction for a given credit product, such as an auto loan.

Let’s take a look at the kinds of FICO scores different lenders use.

Credit card issuers: FICO Bankcard scores

When it comes to credit card approval decisions, issuers often use a version of the FICO Bankcard score — especially FICO 8. This variation of the FICO score focuses on predicting your credit risk for a credit card.

Another notable difference is in the score range: The base FICO scores range from 300 to 850 points, while the industry-specific FICO scores have a broader range of 250 to 900 points.

Auto lenders: FICO Auto scores

With car loans, lenders are likely to consider the industry-specific FICO Auto scores, with FICO Auto Score 8 being the most used version. This variation of your score is calculated by placing more weight on car loan-specific risk behaviors.

“That industry-specific overlay score card may pull up characteristics related to how you’ve managed previous auto loans,” Quinn explains.

However, even if you haven’t had a car loan before, the score will assess your other credit data for certain patterns of risk associated with taking on auto debt.

Mortgage lenders: Earlier FICO score versions

A mortgage is one of the most significant loan obligations a consumer can take on. For that reason, lenders will typically pull all three credit reports and FICO scores on each applicant.

FICO 2, FICO 4 and FICO 5, which are based on data from Experian, TransUnion and Equifax data, respectively, are typically used in mortgage lending. Generally, lenders make a decision based on the score in the middle of these three.

To prepare your credit for a mortgage, be sure to keep an eye on your credit reports and scores, apply for new credit only when you need it and work on reducing your credit card debt. And paying all your bills on time is always crucial to keeping your credit in good shape.

Which FICO score should I check?

You don’t necessarily need to be aware of each credit score you have at all times. Generally, it’s enough to stay on top of your FICO 8 score to have a good idea of your credit health.

However, when you’re shopping for a loan, such as a car loan and especially a mortgage, you may want to have a better idea which score versions — such as the ones commonly used for mortgage, auto or credit cards — your potential lender will see when checking your credit.

Further, many lenders and credit card issuers participate in the FICO Score Open Access program, which provides consumers free access to their FICO scores.

Quinn also suggests is to check user forums hosted by myFICO, where you can search for specific topics, such as “Which lenders use FICO Score 9?” and find a topic where users discuss their understanding of which scores and score version their banks and lenders use. This way, you might be able to find a lender that uses the score you know is your highest before applying. Note, however, that this information isn’t verified even though it may help you get useful insight.

Bottom line

There are multiple versions of a FICO score, and each lender determines which version it will use when evaluating a request for credit. While it might not be feasible to stay on top of each variation of your credit score, maintaining good credit habits is important.

“Regardless of your situation, it’s always important to pay your bills on time, use your available credit responsibly and only apply for credit when absolutely needed,” Quinn says.