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CREDIT SCORES


Credit Scores are a numerical value representing our perceived loan worthiness. Lenders, banks and creditors rely heavily on the credit scoring system in order to qualify their borrowers. Most auto, mortgage and business lenders will look at your credit scores as the first step towards qualification. 


FICO SCORES


The very first credit score was created by a Bill Fair and Earl Isaac. They created a company called Fair Isaac and Co which is now known as FICO. They have a near monopoly on the credit scores that the banks, lenders and creditors use. 9 out of 10 lenders use FICO scores. 


VANTAGE SCORES


The three credit agencies; Equifax, Experian and TransUnion go together and created a credit scoring system to rival the FICO dominance. The problem is that the lending industry never really started using the Vantage scoring system. The bureaus decided to sell the credit scores directly to consumers on various websites such as TrueCredit and CreditKarma. They advertise the Vantage score as a real credit score directly from the bureaus themselves. This sales pitch tricks consumers into thinking that the Vantage Score has some type of value while the lending industry commonly refers to it as a FAKO score because it has no relevance to lending. Don't be fooled by the Vantage Score or any other non-FICO scoring systems. 


OTHER CREDIT SCORING SYSTEMS


There are many other credit scoring systems available to consumers. You can find them on websites such as Experian.com, IdentityGuard, Lifelock, Creditchecktotal, Equifax.com. Pretty much every credit website that offers a credit score is most likely going to be some type of FAKO score that is not used my any lender, creditor or bank. These credit scoring systems have names such as: CreditExpert Score, Consumer Score, Plus Score and of course Vantage Score. 


FICO 08


Fair Isaac Corporation has a new credit scoring product that is not being heavily utilized by the lending industry. The new product is called FICO 08 and takes into consideration many more factors than the FICO scoring products currently in use. Until the lending industry switches over to the new scoring model, we can consider the FICO 08 a FAKO score as well.


FICO 04, Beacon 5.0 and Fair Isaac V2


The FICO scoring products that are most commonly used by lenders are the models listed above. The FICO 04 model is used to score your TransUnion report. The BEACON 5.0 is used to score your Equifax report and the Fair Isaac V2 is most commonly used to score your Experian report. The only website that you can obtain these types of credit score is www.myfico.com


 







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