In my book, MoneyMarci's Guide to Financial Literacy, I talk about the importance of your credit score. I don't go into the specifics of which credit score; FICO, VantageScore, or the score offered by the 3 credit bureaus. This is intentional because while each score is computed somewhat differently, they are all based on the same relative information.
Payment history
Total outstanding debt
Length of payment history
New credit
Credit mix
Total credit to credit available
Recent inquiries
It's important to understand that while they all pull from the same source information (your financial history), they each determine which items to use, and how heavily to weight them in their score calculation. This means that your score may be different depending on which score is pulled. You don't get to control, or even know, which score a lender is pulling to determine if they will give you credit. FICO is the one most commonly used by lenders evaluating credit.
The credit scoring organizations have their own ranking charts for credit scores.
FICO scores range from 300 to 850:
800+ - exceptional.
740 to 799 - very good.
670 to 739 - good (This is the median credit score range).
580 to 669 - below average.
579 or less - poor.
VantageScore scores range from 300-850:
780+ - excellent (super prime)
661 to 780 - good (prime)
601 to 660 - fair (almost prime)
300 to 600 - poor (sub-prime)
The most important thing to remember is that no matter which score or what your borrowing purposes, your credit history is likely to be reviewed and analyzed by a credit company to calculate a score that will determine your opportunities. Don't borrow more than you can afford, pay timely, and review your credit report for accuracy.
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