How Does VantageScore Work?

A credit scoring model is the mathematical formula used to calculate credit scores based on the information contained in consumer credit files. VantageScore is the only tri-bureau scoring model with a proven track record of better consistency, accuracy and performance.

How Are VantageScore Models Developed?

VantageScore analyzes data supplied by the three national credit reporting companies (CRCs) – Equifax, Experian and TransUnion – but we don’t stop there. Our scientists incorporate groundbreaking modeling techniques and strategies in our models that benefit both lenders and consumers.

  • Trended Credit Data: VantageScore 4.0 is the first and only credit scoring model to incorporate this newly available information. Trended credit data reflects changes in credit behaviors over time, versus relying on static, individual credit-history records. We leverage trended credit data to gain deeper insight into borrowing and payment patterns, particularly among consumers in the Prime and Superprime credit-score bands.
  • Machine Learning: VantageScore uses these advanced algorithms in the development of credit scorecards for consumers with dormant credit histories – those with no update to their credit file in the previous six months. This approach strengthens VantageScore’s ability to accurately score approximately 40 million more people, consumers who would not be able to obtain scores from other commercially available scoring models.
  • National Consumer Assistance Plan (NCAP) Optimization: VantageScore 4.0 is the only tri-bureau credit scoring model developed in anticipation of the CRCs’ intent to implement certain data suppression measures through the NCAP. Our model accounts for this removal of public record information, including tax liens, civil judgments and certain medical collections information from consumer credit files.

By using a broader and deeper set of credit file data and more advanced modeling techniques, the VantageScore 3.0 and 4.0 models allow lenders to accurately assess approximately 40 million more consumers than other credit scoring models. Our approach to scoring creates opportunities for lenders and credit-worthy borrowers alike.

What Data Does VantageScore Use?

The VantageScore 4.0 model was built using a refreshed data set from 2014-2016 to account for recent credit products and trends in consumer behavior. Development was based on anonymized consumer credit files from all three CRCs.

We consider things like how many credit accounts people have, how much they borrow and how promptly they make required payments. These and other key factors influence a person’s credit report and, ultimately, their VantageScore credit score.