What is VantageScore® and How Does It Work?

Many lending decisions are influenced by your credit score and the financial standing that score represents. You’ve probably heard of the popular FICO® Score, but lenders use other models as well. VantageScore® is another credit score that you should get to know, especially since over 3,400 banks, fintechs and other companies use it in assessing creditworthiness.¹

What is VantageScore®?

Your VantageScore® helps lenders determine how likely you are to repay them when you apply for a loan or line of credit. It was developed by the three major credit reporting agencies — Equifax, Experian and TransUnion — in 2006 to provide a consistent, predictive and easy-to-understand scoring model.² Financial institutions, including eight of the 10 largest banks in the U.S., used approximately 27 billion VantageScore® credit scores in 2023 when making loan decisions.³

Like the FICO® model, VantageScore® uses a 300-850 scale, making it easy to recognize. However, since each model calculates scores differently, your FICO® and VantageScore® may not be the same, even if they appear similar.

Over the years, VantageScore® has released several updated versions to improve accuracy and reflect changes in consumer behavior and credit reporting practices. While VantageScore 4.0 (released in 2017) is the latest version, VantageScore 3.0 is still widely used by lenders, making these the two most relevant versions today.

How is your VantageScore® calculated?

Here’s the breakdown of factors⁵ that are used to help determine your VantageScore®:

• Payment history (extremely influential): This reflects whether you pay your bills on time.
• Age and type of credit (highly influential): This looks at how long you’ve had credit and the different types of accounts you use, such as credit cards, car loans and mortgages. A longer credit history and a mix of credit types can help improve your score.
• Credit usage (highly influential): This measures how much of the available credit you’re using and is often referred to as your credit utilization rate. Keeping balances low compared to your credit limit can possibly boost your credit score. Lenders may also look at your debt-to-income ratio (DTI) — the percentage of your income that goes toward paying off debt — to understand and predict your financial situation.
• Total balances and debt (moderately influential): This looks at the total amount of money you owe to creditors, who have given that information to credit reporting agencies.
• Available credit (less influential): This refers to the total amount of credit you have access to across all your accounts. Having more available credit — while keeping balances low — can help your credit score by reducing your credit utilization rate.
• Recent credit inquiries and behavior (less influential): This includes how often lenders have checked your credit in response to applications for loans or credit cards (these credit checks are called hard inquiries and may impact your credit score), and how many new accounts you’ve recently opened. Applying for multiple new credit accounts in a short period can look like potential risky behavior and may lower your score.

VantageScore® vs FICO®: What's the difference?

Although these scoring models are similar, there are a few differences that you should be aware of.

VantageScore®

• Scores can be calculated if you have at least one credit account that has been open for a month and at least one account has reported in the last two years.⁶
• Examines consumer credit behavior over a period as opposed to a simple snapshot. This method takes a broader look at your overall credit health and creditworthiness.⁷
• Counts multiple hard inquiries for the same type of credit as one hard inquiry if they occur within a 14-day period. This practice is applied to all types of credit inquiries, including credit cards.⁸

FICO®

• Generally requires at least six months of credit history and at least one account has reported within the last six months to establish a credit score.⁹
• Focuses more on the consumer’s overall credit history, including long-term patterns of behavior.
• Counts multiple hard inquiries for the same type of credit as one hard inquiry if they occur within a 45-day period. This rule refers to applications for mortgages, car loans and student loans.¹⁰

Where can you get your free VantageScore®?

Getting your monthly VantageScore® credit score is easy (and free) if you’re currently a OneMain loan customer.¹¹ Log in to your account to see your score displayed on your account summary page. You can also use the links on that page to track how your score has evolved over time. Your score is updated monthly, and you can check it as often as you want.

If you’re not currently a OneMain customer, you can get your VantageScore® by contacting your:¹²

• Bank
• Credit union
• Lender
• Loan servicer
• Credit card issuer

You can also find a list of financial technology companies, banks and lenders (like OneMain) that may offer free VantageScore® access when you visit the VantageScore® website.

How to improve your VantageScore®

Here are a few ways to get smart about credit and possibly improve your VantageScore®:

• Pay all your bills on time: On-time payments are the most important factor in your credit score. Set up automatic payments or reminders to avoid missing due dates. If you know you’ll be late on a payment, contact your lender to discuss what options are available to you.
• Keep your credit card usage low: Try to use no more than 30% of your total credit limit each month. This is especially important under VantageScore 4.0, which considers credit utilization over the past two years, not just the previous month.
• Use a mix of credit types: Having both revolving credit (like credit cards) and installment loans (like personal or auto loans) can help improve your score. However, don’t take out a loan just to improve your credit — only borrow when necessary.
• Be mindful when applying for new credit: If you need a new loan or credit card, submit all applications within a 14-day period, so they count as a single inquiry. After that, avoid applying for new credit for at least six months to maximize your score.
• Consider a secured credit card if you have a low credit score: If your score is too low to qualify for a standard credit card, a secured credit card may help you build credit. You’ll provide a refundable security deposit, and your payments will be reported to the credit bureaus like a regular credit card.¹³

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Take control of your credit journey

Whether you're applying for a personal loan, car loan or your first credit card, knowing how your VantageScore® is calculated can empower you to take control of your credit story. As you move ahead, remember that your credit score is more than just a number — it's a reflection of your financial habits and a tool to unlock future opportunities. Learn everything you can, make wise choices, and watch your financial future flourish.

1,2,3. VantageScore. https://vantagescore.com/company/about-vantagescore/
4. Nerdwallet https://www.nerdwallet.com/article/finance/vantagescore-4-0
5. Nerdwallet https://www.nerdwallet.com/article/finance/vantagescore-fico-score-the-difference
6,8,10. Equifax https://www.equifax.com/personal/education/credit/score/articles/-/learn/difference-between-fico-scores-vantagescore/
7. VantageScore https://www.vantagescore.com/lenders/why-vantagescore/our-models/#:~:text=VantageScore%204.0%20is%20the%20first,lenders%20make%20more%20confident%20decisions
9. MyFICO https://www.myfico.com/credit-education/faq/scores/fico-score-requirements
11. Score is displayed for primary borrowers only and will be updated monthly. The credit score provided is for educational purposes only. We do not guarantee that the credit score shown will be used by us or third parties to assess your creditworthiness or eligibility for any particular product or service or employment.
12. Experian https://www.experian.com/blogs/ask-experian/what-is-a-vantagescore-credit-score/
13. The Complete Guide to Your VantageScore https://www.vantagescore.com/the-complete-guide-to-your-vantagescore/ This article has been updated from previous postings from 2020-2022. Jessica Leshnoff and Kim Gallagher contributed to this post.

This article has been updated from previous postings from 2020-2022. Jessica Leshnoff and Kim Gallagher contributed to this post.