The credit score used in mortgage applications
While the FICO® 8 model is the most widely used scoring model for general lending decisions, banks use the following FICO scores when you apply for a mortgage: FICO® Score 2 (Experian) FICO® Score 5 (Equifax) FICO® Score 4 (TransUnion)
Versions 8 and 9 of FICO scores are similar, but FICO score 9 is generally considered the more forgiving of the two for a few reasons: With FICO 9, third-party collections no longer hurt your credit score once those debts are paid off. FICO 9 treats medical collections differently than other types of debt.
It's also worth mentioning that lenders widely use the FICO 9 credit score in the U.S., but it's not the only option available. Some lenders may use other credit scoring models, such as VantageScore, a joint venture between the three major credit bureaus (Equifax, Experian, and TransUnion).
FICO® Score 9 from Experian®
Simple access via Wells Fargo Online, to help you know where you stand.
For other types of credit, such as personal loans, student loans and retail credit, you'll likely want to know your FICO® Score 8, which is the score most widely used by lenders.
FICO® Score 8 is one of the most widely used FICO® Credit Scores and there's a good chance that your lender may use it too. For example, if you're trying to get a new credit card, personal loan, student loan, or retail credit, your FICO® Score 8 may be important.
Credit scores from the three main bureaus (Experian, Equifax, and TransUnion) are considered accurate. The accuracy of the scores depends on the accuracy of the information provided to them by lenders and creditors. You can check your credit report to ensure the information is accurate.
Making payments on time each month for credit cards, loans, and other bills can help establish a positive history and lead to a better FICO score. Paying late, on the other hand, can be damaging to your score. FICO scores also view collection accounts in a negative light.
FICO scores are generally known to be the most widely used by lenders. But the credit-scoring model used may vary by lender. While FICO Score 8 is the most common, mortgage lenders might use FICO Score 2, 4 or 5.
An Equifax credit score isn't used by lenders or creditors to assess a consumers' creditworthiness. Instead, many lenders use FICO Scores® to help determine a potential borrower's creditworthiness. FICO uses credit scores from the three reporting agencies, including Equifax and Transunion, to determine their score.
A score in the high 700s or 800s is considered excellent. About a third of consumers have FICO Scores that fall between 600 and 750—and an additional 48% have a higher score. In 2023, the average FICO® Score☉ in the U.S. was 715. Lenders use their own criteria for deciding whom to lend to and at what rates.
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.
Your FICO score is a representation of your credit worthiness. FICO offers specific products and solutions for car dealers and auto loans. Their product is called Auto Score 8. As you can see here from FICO's promotional materials, Auto Score 8 is meant to help dealers, “Improve accuracy and speed of decision making.
Credit reports and other FICO Score versions will be updated based on the type of subscription you have – monthly for FICO® Basic or FICO® Premier and quarterly for FICO® Advanced. They will also be updated if you purchase additional credit reports that aren't a part of your subscription.
A couple people from my last post wanted to know if there was a difference between the scores given by Credit Karmas scores and Wells-Fargo's scores. Credit Karma gave me 750 for their Equifax score and 742 for their TransUnion Score. Wells-Fargo gave me a 754 with their FICO Score 9 system.
According to FICO, only 1.6% of the population has an 850 credit score. It's incredibly tough to get there, but reaching an 850 score is possible. The first step in achieving an 850 credit score is understanding how the process works.
Your FICO Score is a credit score. But if your FICO score is different from another of your credit scores, it may be that the score you're viewing was calculated using one of the other scoring models that exist.
1 Two of the most common are the FICO Score 5 and the FICO Score 8. Both are used by lenders to determine a prospective borrower's creditworthiness. But FICO 5 is commonly used in the mortgage lending industry, while FICO 8 is mainly used by credit card issuers.
Although there are many ways to check your credit scores, you'll have to look closely at the product offerings—and sometimes the fine print—to see if you can check one of your FICO Bankcard Scores. Experian offers a free credit score and credit report, which includes your FICO® Score 8 based on your Experian report.
Apple Card uses FICO Score 9. FICO Score 9 ranges from 300 to 850, with scores above 660 considered favorable for credit approval.
The minimum credit score needed for most mortgages is typically around 620. However, government-backed mortgages like Federal Housing Administration (FHA) loans typically have lower credit requirements than conventional fixed-rate loans and adjustable-rate mortgages (ARMs).