Vantage 4.0 vs FICO 10T

Vantage 4.0 and FICO 10T are all the buzz in the mortgage industry today, but there are a lot of questions around both and how they differ. Right now, Vantage 4.0 is in a Pilot phase with 21 GSE chosen lenders. The Pilot phase for 10T has not begun yet and likely will not until analytical data is gathered from the Vantage phase which is expected to last through the summer of 2026. Let’s look at the some of the differences.

Credit History:

• Like the Classic Fico scores, FICO 10T requires a minimum of 6 months of history with an active, open account to generate a score.
• Vantage can generate a score with only one month of history on an active, open account.

Alternative Credit:

• Both FICO 10t and Vantage 4.0 factor in alternative credit such as rent and utilities. They must be reported by a company that gathers that data and reports it to the bureaus. They will also both factor in Experian Boost (will affect Experian only) and the Trans Union eCredable program (will affect Trans Union only)

Collections

• Paid medical debts are excluded from the algorithm as are unpaid medical collections under $500. Unpaid medical collections over $500 are still factored in but are a little more forgiving than with the Classic FICO models.
• All paid collections (not just medical) are excluded from the Vantage model. All unpaid medical collections are also excluded.

Inquiries

• FICO 10T factors in inquiries just as the older models did. There is a 45-day shopping window for mortgage and auto inquiries. During that time, any inquiries for those two industries are factored in as one inquiry only.
• Vantage score has a 14-day shopping window for ALL inquiries. They lump them all together regardless of the industry.

Trended Data

• Both models utilize Trended Data which is a look back over a 24-month period at spending and payment habits. It is not a “snapshot” in a single moment, but more of a “video” of the history of financial routines.
• Each model looks at the Trended Data differently.
• If a borrower is a “Revolver” (they carry balances) but makes more than the minimum payment every month Vantage score recognizes this as a positive step and the score will increase more quickly than with FICO 10T.
• If a borrower is a “Transactor” (pays most revolving balances off every month” both models will benefit from this.
• If you are accumulating debt every month but still making the minimum payments, FICO 10T looks at this as a negative trend and will be harsher on the score than Vantage is.

Scoring categories:

Studies have shown that Vantage scores are a bit more forgiving than FICO scores, therefore Vantage scores tend to run a bit higher than FICO scores. Because they can be higher this is not necessarily a sign that they are less predictive of borrower default, Vantage simply weighs all the credit variables differently than FICO. As these models are utilized more it will be interesting to follow their impact on lending.