FICO & FAKO Credit Scores

FICO & FAKO Credit Scores : On some websites, blogs, and books you might read about credit scores called credit scores or FICO scores. You can even see them referred to as VantageScores, a newer model. 

 

Another credit score term that gets thrown around in forums and blogs is the FAKO credit score. What are all these different scores? Which one means what?

Credit Score Is a Generic Term

Think of credit score as a generic term that refers to the numerical value given to the history of your credit. Your credit score is determined based on the information contained in your credit report and indicates whether you have a good (high credit score) or bad (low credit score) credit history.

 

Several companies offer credit scores, and the three major credit bureaus each offer their own variant of the credit score. In addition, the three credit bureaus have collaborated and produced their own credit score, the Vantage Score.

FICO Is a Brand of Credit Score

For those analogically inclined, the FICO score is the most well-known credit score. It is a branded credit score, developed and published by a company known as FICO, formerly Experian. 

 

Credit score is like a band-aid to FICO. To make matters even more confusing: the FICO score is often referred to, but other credit scores exist as well.

What About FAKO?

Typically, FAKO scores are simply credit scores that weren’t generated by MyFICO.com. They are used only for educational purposes and do not reflect the credit scores lenders actually use to approve your applications. 

 

Even when a FICO score is purchased online, the one your lender uses may not match the one you have because there are many versions of the FICO score, versions for various industries, and previous versions introduced years ago.

What’s the Difference?

As far as we know, all the credit scores are generally calculated the same, with the exception of the VantageScore, which gives different weights to credit report information. 

Since we cannot see the exact formulas, we’re unable to determine specific differences.

 

Whenever possible, lenders and creditors receive their credit scores from the company they do business with. The score could come from a credit bureau or FICO score, or from the lender itself. You will only know it if your lender tells you.

 

You are required to obtain a copy of your credit score from every lender when your credit report was the reason for their decision to either deny or approve you for less favourable terms.

Which Should I Care About?

In this day and age, too many credit scores exist for you to improve all of them individually. If you strive to improve your credit, you should rely on your FICO score. By improving your FICO score, you can improve your other credit scores too. 

 

You can only buy your FICO score if you receive your credit report information from Equifax and TransUnion. Experian has stopped allowing FICO to sell consumer credit scores based on Experian’s credit report information.

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