Superprime is the best rating you can have and indicates a financially responsible borrower who can be trusted to pay back what they borrow. Prime credit is still good and you shouldn't have much trouble getting approved for loans or lines of credit if you fall in this range.
If you have near-prime or subprime credit, you'll probably struggle a little more when applying for loans or credit cards. Near-prime borrowers may get saddled with higher interest rates than their prime and superprime counterparts, while subprime borrowers might be denied outright. Take steps to improve your VantageScore if it falls into one of the lower two ranges.
Who uses VantageScore?
Financial institutions, like banks and credit unions, often pull your VantageScore to assess the risk in lending to you. Credit card companies and auto lenders also use it. But it's up to each lender to decide which credit scoring model and which version of that model it wants to use.
Usually, you won't know this ahead of time, but fortunately, all credit scoring models consider similar factors, so if one credit score is high, your other scores are likely to be somewhere in the vicinity.
How to check your VantageScore
Several banks and credit card issuers offer free VantageScore 3.0 scores to consumers, though these are typically only from a single bureau. In some cases, you don't even have to work with that lender to receive a free VantageScore. VantageScore's website maintains a list of companies that provide free VantageScores to their customers or the general public.
While not free, you can also get VantageScores directly from the credit bureaus. You might purchase one of these scores to supplement your free VantageScore if your free score is only based on your credit report from a single bureau.
VantageScore 4.0 is still a relatively new scoring model and there doesn't appear to be a place where you can view these yet, either for free or for purchase. But, for most consumers, your VantageScore 3.0 should be similar to your VantageScore 4.0 so this shouldn't be a concern.
How to increase your VantageScore
Raising your VantageScore -- or any credit score for that matter -- comes down to managing your money responsibly. The most important thing you can do is always pay your bills on time. Set up automatic payments or reminders for yourself if you struggle to do this. If you know a payment is going to be a little late, reach out to your lender to notify them and request that they don't report it to the credit bureaus. Your lender might comply if you've been a good payer up until that point.
Limit your credit card usage to 30% or less of your total credit limits each month. This will become even more important as more and more lenders transition to the VantageScore 4.0. Unlike the VantageScore 3.0, which only looked at your credit utilization ratio for the previous month, VantageScore 4.0 considers your credit utilization ratio for up to two years prior.
Try to have a mix of revolving and installment debt on your credit report, but don't take out a loan just for the sake of improving your credit. If you're going to apply for a new loan or line of credit, submit all your applications within a 14-day period so they count as a single inquiry. To maximize your score, avoid applying for more new credit for at least six months after.
If you're struggling to get approved for any type of credit because your VantageScore is subprime, try opening a secured credit card. These cards are designed to help individuals with poor credit improve their scores.
You make a security deposit, which is typically a few hundred dollars and equal to your credit limit. If you fail to pay back what you borrow, the lender keeps your security deposit and no harm is done. It reports your monthly payments to the credit bureaus just like a regular credit card and if you decide to close the card in the future, you'll get your security deposit back, assuming you don't have a balance.
Beyond that, you just have to give it time. Credit scoring models like VantageScore are designed to provide lenders with a long-term view of how you handle your money so they can make informed decisions about whether they're comfortable working with you.
Assuming you follow the tips above, you can expect to see your score rise over time simply because your accounts are aging and you've demonstrated a longer history of responsible money management.
VantageScore vs. FICO® Score: What's the difference?
The FICO® Score is the most popular credit scoring model in use today. It's designed to do the same job as the VantageScore -- measure a person's financial responsibility -- but it takes a different approach. Here's how the FICO model evaluates your score:
