As the cost of living rises, financial health becomes more essential. Websites offering free access to a consumer’s credit score have proliferated to meet demand. Similarly, many credit card companies provided free access to consumers’ credit scores, but only to those who had an account with the card issuer or bank in question.
Not only does the Discover Credit Scorecard give access to FICO score, but it also offers credit monitoring and Social Security number alerts. Fortunately, even those who do not have a Discover account can use this service to access their FICO credit scorecard for free.
About Discover Credit Scorecard
Discover was the first major credit card company to allow everyone – not just Discover cardholders -to check their FICO scores for free on its website in 2016.
Along with viewing FICO score and the factors from the credit report that influence consumer’s FICO score, the total accounts, the length of credit history in years, the number of hard inquiries in the last 12 months, the percentage of consumer’s credit limit, and the number of missed payments over the last seven years.
Discover Credit Scorecard also alerts a person to three types of new activity that can impact their credit score or signal potential fraud:
- Alerts for Social Security Numbers
- Alerts for New Accounts
- Alerts for New Credit Inquiries
The Significance of FICO score
A consumer receiving a FICO score is significant because FICO is the most commonly used credit-scoring formula by banks and other creditors.
Many competitors in the free credit-score market, such as Credit Karma and Credit Sesame, provide users with the Vantage Score credit score.
While the Vantage Score and user’s FICO score are unlikely to differ significantly (and some creditors do use the Vantage Score formula), the consumer’s FICO score is still what most people think of when they hear the term “credit score.”
Credit Scoring Models: FICO and Vantage Score
Two of the most common credit-score models are Vantage Score and FICO Score. Their scores are used to help determine applicants’ eligibility for credit cards, loans, mortgages, and other situations that necessitate lending money. These scores, in the end, help to measure consumer risk in an easy-to-understand number.
Both models produce results ranging from 300 to 850. Vantage Score scores previously ranged from 501 to 990 (up until 2013). It was changed, however, to make it easier for consumers and lenders to compare models.
Both models have significant differences because they are built and maintained by separate organizations. Continue reading to learn about some of the key differences between Vantage Score and FICO Score.
Because Vantage Score and FICO are models developed by separate organizations, they have several significant differences. Here are some of the most significant differences between them:
Criteria of foundation
Since Vantage Score and FICO both use similar criteria to create a score, the exact criteria and how the scores are calculated differ slightly.
The consumer’s Vantage Score is calculated as follows:
- Payment history is extremely influential.
- Credit type and duration are highly influential, as is the percentage of credit limit used.
- Total balances/debt have a moderate influence.
- Recent credit behavior and inquiries are less influential, as is available credit.
Meanwhile, FICO Score divides the weight of its credit factors into percentages:
- Payment history accounts for 35% of the total.
- Amounts owed 30%
- 15% is Credit history length.
- Credit mix and new credit each receive 10%.
Vantage Score previously disclosed percentages, with payment history accounting for 40%, credit age and mix accounting for 21%, credit utilization accounting for 20%, balances accounting for 11%, recent credit applications accounting for 5%, and available credit accounting for 3%. However, because they now use the term “influential,” those percentages may no longer be accurate.
The Difference Between Vantage Score and FICO
Because Vantage Score and FICO Score are calculated differently, use different data, and draw information from different sources, consumers may see scores when comparing score-checking tools. Consumers’ levels of success when applying for different loans or credit cards may vary depending on which model accreditor employ, furthermore, by comprehending the distinctions between Vantage Score and FICO. Most differences in scores should be minor, implying that the real-life impact of different credit scores should also be minor.
A credit bureau is a company that collects and sells information about people’s credit histories. They usually collect information such as the user’s credit card and loan balances, the number of credit accounts, payment history, any bankruptcies, etc.There are dozens of credit bureaus in existence today, but the “big three” are Equifax, Experian, and TransUnion. Credit bureaus are also known as “Credit reporting agencies.”
The Personal Information Collected by Credit Bureaus
Credit bureaus primarily collect information from credit institutions that have an existing relationship with consumers. Credit institutions include:
- Companies that issue credit cards
- Providers of student loans
- Auto loan companies
Credit bureaus do not have access to these accounts; rather, the credit institutions share the information with the credit bureaus. Credit institutions are not required to share information and may provide information to one, two, three, or none of the major credit bureaus. Credit bureaus typically keep information on balances, available credit, payment history, and the number of open and closed accounts.
Spotlighting Discover Credit Scorecard
Discover Credit Scorecard is an excellent tool for monitoring a user’s FICO score and the factors that influence his FICO score. The only drawback is that while users can access information from their Experian credit report, they cannot access TransUnion or Equifax.
Furthermore, the service does not provide as many additional features as some competitors. Credit Sesame, for example, provides free $50,000 identity theft insurance, whereas Discover does not. Nonetheless, free access to a consumer’s FICO score is a worthwhile offer.