What Is a Beacon Score?
Let me tell you about the Beacon score—it's one of the many credit scoring models created by FICO, the big player in this space. It's still around today, but now it's just branded as a FICO score. Back in the day, people often called it the Equifax Beacon score because of its ties to that credit bureau. For instance, what was once the Beacon 5.0 is now FICO Score 5, and it's heavily used in the mortgage world.
Key Takeaways
Here's what you need to know: The Beacon score comes from FICO's lineup of credit models. It got rebranded to just FICO score. These scores pull from data collected by Equifax, Experian, and TransUnion, and each bureau offers several FICO versions. Plus, those bureaus teamed up to create VantageScore as a rival to FICO.
How FICO Credit Scores Work Today
The three main credit bureaus—Equifax, Experian, and TransUnion—gather details on your credit habits into reports. They use this to calculate your credit score with various methods. Scores are three-digit numbers, usually from 300 to 850, showing how creditworthy you are—the higher, the better, meaning less risk.
FICO started this in 1989 with the Fair Isaac Corporation, and it's been updated for better accuracy. Names have changed too; besides Beacon, there was the Pinnacle score, now FICO Score NG (NextGen). For example, Pinnacle 2.0 became FICO Score NG 2.
Some lenders stick with older models they're used to, and FICO has versions tailored to specific industries. That's why you likely have multiple scores, not just one.
Take Equifax: They offer at least 13 FICO scores in the US, like the popular FICO Score 8, the newer FICO Score 9, and the latest FICO Score 10 and 10T. They also have industry ones, such as FICO Score 5 for mortgages, Auto Scores 5, 8, and 9 for car loans, and Bankcard Scores 5, 8, and 9 for credit cards.
Experian and TransUnion have similar offerings. While they still partner with FICO, the bureaus launched VantageScore in 2006, with VantageScore 4.0 out since 2017.
VantageScores use the same 300-850 range from credit reports but differ in details. For FICO, you need accounts open at least six months and reported recently to all bureaus. VantageScore is more flexible: one month open and one report in the last two years.
How to Improve Your Credit Score
Both FICO and VantageScore weigh your credit report info differently, but the basics are similar. For FICO, payment history is 35%—it's about paying on time without misses. Amounts owed are 30%, focusing on your credit utilization ratio, or how much you owe versus your limits.
Length of credit history is 15%—older accounts help if you've paid them well. Credit mix is 10%, rewarding responsible use of different types like cards and loans. New credit is 10%—too much new debt can hurt, signaling potential issues.
VantageScore tweaks these weights, and industry models add extras, but you can keep scores high by paying on time, keeping utilization low, and holding onto old accounts.
How Can You Find Out Your Credit Score?
You can get your credit score for free from many banks and card issuers, or through certain websites. Remember, you have multiple scores, so what you see might not match what a lender pulls for a loan application.
How Can You Obtain Your Credit Reports?
By law, you're due one free report from each of the three bureaus every year. Go to AnnualCreditReport.com for that. If you spot errors, dispute them with the bureau—they must investigate and respond.
Aren't All Three Credit Reports the Same?
Not always. Bureaus get data from your creditors, and not every creditor reports to all three—or any. So reports can vary, which affects your scores too.
What Is a Good Credit Utilization Ratio?
Lower is better. Equifax suggests keeping it at 30% or below.
The Bottom Line
Credit models and names evolve, but the habits for a strong score stay the same: pay on time, manage debt wisely, and build a solid history.
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