When people discuss credit scores, they often make it seem as though you only have one. But the truth is, you actually have multiple credit scores.
The primary scores used by the three major credit bureaus — Experian, Equifax and TransUnion — are your FICO® Score, VantageScore® and ResidentScore. We explain why you have more than one credit score and break down the differences among the credit scores.
ResidentScore: Predicts risk of rental skips/eviction within a 12 month period. Places greater weight into credit history within the last 24 months. Requires 2 weeks of credit history to calculate credit score.
VantageScore: Predicts risk of delinquency of 90+ days across ANY credit account within a 24 month period. Widely used score across credit-monitoring sites. Requires 2 weeks of credit history to calculate credit score.
FICO: Predicts risk of delinquency of 90+ days across any credit account within a 24 month period. Used a standard within mortgage lending and multi-year loans. Requires at least 6 months of credit history to calculate credit score
What if you could protect your properties from risky applicants while finding the qualified residents other scoring models turn away?
With ResidentScore®, you can! Our proprietary scoring model behind TransUnion’s ResidentScreening is dedicated to the rental industry and based on data only TransUnion can provide. Don’t turn away good applicants.
Using the same traditional 350-850 credit score scale you're accustomed to seeing, and built with actual rental outcome data from the industry, our comprehensive score identifies the characteristics of apartment residents most important to you. It predicts the likelihood of evictions and provides you with the insight you need to reduce risk and gain better residents.
The reports come directly from TransUnion SmartMove, who provide a Resident Score on their credit reports. This score is tailored specifically for the rental industry and is helpful in predicting renter outcomes.
Elements of the Resident Score
Here we will break down each section of the Resident Score and how it factors into the final score
•30% - Payment History - Someone's personal track record of paying bills on time
•26% - Utilization - The amount of available credit being used by someone.
•21% - Credit History - Credit Performance over time.
•13% - Credit Availability - Magnitude of credit extended to someone.
•10% - Inquiries - Information related to someone's credit seeking behavior.
The rental industry calculates risk using different predictors than the credit industry.
• Insurance Risk Model - Predicts likelihood of an insurance claim
• Mortgage Risk Model - Predicts likelihood of foreclosure
• Resident Risk Model - Predicts likelihood of a negative rental outcome i.e. risks of an eviction, late rental
payments, and/or insufficient funds.
Your FICO Score, which was developed by Fair Isaac Corporation, is used in 90% of all lending decisions, and while it’s been around since 1956, it was only recently made available to consumers in 1989. The three-digit number typically ranges from 300 to 850.
According to FICO, a score in the range between 670 and 739 is considered a good credit score and can help you secure lower interest rates on your mortgage, car loan or any other type of loan.
The five factors that determine your FICO Score and how much each factor is weighted are:
• Payment history (35%): This measures on-time payments.
• Amounts owed (30%): This measures how much debt you’re carrying relative to your credit limits.
• Length of credit history (15%): This measures how long you’ve been handling credit.
• New credit (10%): This measures how often you apply for new credit.
• Credit mix (10%): This measures how you handle different types of credit, such as credit cards and loans.
FICO uses the following ranges to determine your credit rating:
The three major credit bureaus created the VantageScore in 2006 as an alternative to the FICO Score to better address changes in behavioral trends and advances in data collection.
The most current versions of the VantageScore (3.0 and 4.0) now have the same range as the FICO Score (300 to 850). However, where it can take up to six months of credit activity to generate a FICO Score, it only takes one month of credit history to generate a VantageScore.
VantageScore ranges are as follow: