Understanding a FICO Score
The relationship between Transrisk and FICO score are like that of Ford and Toyota. Two cars developed for a similar reason. They are the same mode of transportation but constructed with a different material, model, and value.
Transrisk and FICO scoring models use distinct formulas to evaluate your credit history. They are grading the same information but have diverged grading scales. They use different types of formulas using your credit history as the value inputs to determine an output number. These output numbers result in different values because these equations are assembled differently.
Your credit history comes from three major bureaus. Experian, Equifax and Transunion gather data based on your credit history. The information each credit bureau collects will be different since they update information independently. Therefore, the score reflected from one credit bureau may not be the same as another. These credit bureau scores are plugged into FICO and Transrisks' individual scoring models to determine a three digit output only accessible to lenders.
Consumers can obtain credit information through different websites such as CreditKarma, Credit.com, Quizzle, and many more. The information provided is meant for informational purposes only. Individuals using these websites can monitor and keep track of their credit accounts. However, their credit scores will be unique to each website they visit. Like Transrisk and FICO scoring models, these websites have their own formulas to determine consumer's credit score. These scores provide a consumer with an idea of where they may stand based on their credit information. Credit scores obtained from these websites are also known as PLUS Scores, FAKO Scores, or Vantage scores. These scores are higher than that of a FICO score which explains why your score may be lower when accessed by a lender.
Credit Scores are not FICO Scores
Overall, FICO scores differ slightly in formulas because diverse industries have different variations and expectations of who a potential borrower could be. Every consumer score, whether it's paid or non-paid, is going to differ from the FICO score the lender will pull at the time of the application. Vantage scores, Plus scores, and Fako scores are provided to consumers to educate them of information that can be provided and taken into consideration by the lender.
Although they can be confused for one another, credit score and FICO score are not the same score. There are varieties of credit scores as there are FICO scores due to the abundance of formulas across the scoring model spectrum. Credit scores are favorable to the consumer. On the other hand, FICO scores favor the lender by helping them make a more defined decision taking into consideration the criteria and variables distinct to a company's preference for rating a credible borrower.