Credit Cards That Use Fico Score for Approval Explained

Using a FICO score for credit card approval is a common practice among lenders.

FICO scores range from 300 to 850, with higher scores indicating better creditworthiness.

Not all credit cards use FICO scores for approval, but many do.

Some credit cards, like those from Chase, use alternative credit scoring models in addition to FICO scores.

Credit cards use FICO scores to determine approval, and it's essential to understand how this works. Service CU uses FICO 10 for approvals, which is a more recent model that's harder on bankruptcies than FICO 9.

FICO 10T would be even worse for those with bankruptcies, but it makes more sense than FICO 8/9, which allows carrying balances on cards for 23 months without negatively affecting the score.

A lender sees a bankruptcy and evaluates it regardless of the score, so having the same 300-850 score range doesn't mean they consider it the same score value as another lender using a different model.

Your scores, even on FICO 10, are solidly in the "good" range, which is a great sign.

Here's a breakdown of credit score ranges:

FICO scores are just one factor in credit card approval, and different cards have different requirements. For example, the Chase Sapphire Reserve requires excellent credit, while the Discover it Cash Back card requires only a good credit score.

FICO scores are used by 90% of top US lenders, and they're grouped into five categories, each contributing a different percentage to what makes up your credit score.

Your payment history is the No. 1 factor in calculating your credit score, making up 35% of your total score. To earn a good score, it's essential to pay on time, every time.

FICO scores range from 300 to 850, with higher scores indicating better credit. The two major scoring models are FICO and VantageScore, but FICO scores are used by most lenders.

Here's a breakdown of FICO score categories:

A good FICO score can help you qualify for credit cards and loans with lower interest rates.

Free credit scores are available from several major credit card issuers, making it easier to track your credit health. American Express offers free FICO scores to anyone, regardless of their account status.

Some issuers only provide free credit scores to their cardholders. Bank of America, Barclaycard US, Discover, and Wells Fargo offer free FICO scores to their customers who have a credit card account.

Capital One and Chase are exceptions, offering free VantageScores to anyone, not just their cardholders. This is a great perk for those who want to monitor their credit without having to pay for a separate service.

Here's a list of issuers that offer free credit scores:

Keep in mind that FICO scores provided by different issuers may vary, as they get scores from different consumer credit bureaus.

Your credit score is calculated using FICO's scoring method, which groups five categories into different percentages. Payment history is the No. 1 factor in calculating your credit score, making up 35% of it.

Paying on time, every time, will put you well on your way to earning a good score. This is because your payment history tells issuers whether you've paid on time and as agreed, and includes the number and severity of any late payments.

Credit utilization is another important factor, measuring how much of your total credit limit you are currently using. Experts recommend keeping your utilization below 30 percent, but consider that a neutral point.

Your credit history looks at how long you have been using credit, making up 15% of your total FICO score. Accounts that have been open for at least two years will help your score, and having a limited credit history alone does not mean you'll have a bad credit score.

Credit mix is also an important factor, looking at the types of credit you have – revolving and installment. A lender tends to give greater weight to your performance on the type of loan you're applying for, and a credit card issuer looks at your experience with other cards more closely.

New credit makes up the final 10% of your total FICO score, and it's worth noting that any inquiry for new credit or a line increase stays on your credit reports for two years. A high number of inquiries in a short time can negatively affect your score.

Here's a breakdown of the five categories and their respective percentages:

Lenders use different versions of FICO Scores, which can affect your credit score. This is because different lenders have different needs, such as auto lenders who use FICO Auto Scores.

For most credit evaluations, like a credit card application, lenders will use a FICO Score from just one of the three credit bureaus. However, for a mortgage or home equity loan application, they usually take into account a FICO Score from each of the three credit bureaus.

There are several versions of FICO Scores, including FICO Bankcard Scores, FICO Score 8, and FICO Score 9. Most credit card issuers use one of these versions when evaluating your credit risk.

Here are the different versions of FICO Scores used by lenders, along with a brief description of each:

It's essential to know which version of FICO Score your lender is using, as it can impact your credit score and the interest rates you're offered.

Credit card approval requirements can be a mystery, but it's actually pretty straightforward. The two major scoring models used are FICO and VantageScore.

The FICO scoring model breaks down credit scores into five categories: Poor (300 to 579), Fair (580 to 669), Good (670 to 739), Very Good (740 to 799), and Exceptional (800 to 850). The VantageScore model also categorizes scores, but with slightly different ranges: Very Poor (300 to 499), Poor (500 to 600), Fair (601 to 660), Good (661 to 780), and Excellent (781 to 850).

Here's a quick rundown of the credit score ranges and what they mean:

Credit cards are available to people with a wide range of credit scores. There are two major scoring models: FICO and VantageScore.

The FICO scoring model categorizes credit scores into five ranges: Poor, Fair, Good, Very good, and Exceptional. Here's a breakdown of the FICO score ranges:

The VantageScore model also categorizes credit scores into five ranges, but with slightly different boundaries. It's worth noting that there's a credit card out there for just about any credit score.

Even with a fair FICO credit score of 580 to 669, you can find plenty of solid fair-credit cards to choose from.

Having a fair credit score doesn't limit your options, as there are many cards designed for individuals with similar credit profiles.

You can get loans faster with a fair credit score, as lenders can make decisions quickly based on your credit history.

Credit decisions are fairer with credit scoring, as lenders focus on facts rather than personal feelings.

More credit is available to individuals with fair credit scores, as lenders can identify those who are likely to perform well in the future.

Here are some benefits of having a fair credit score:

Cards for Excellence are often out of reach for those with less-than-excellent credit scores. The Chase Sapphire Reserve is a prime example, with an annual fee of $550 and excellent rewards potential, but it's generally only available to those with excellent credit.

Having excellent credit can open doors to premium rewards and perks, but it's not a requirement for all cards. A good credit score is enough to qualify for the Discover it Cash Back credit card, which is one of the best no-annual-fee cash back cards on the market.

The Discover it Cash Back card offers 5 percent cash back on up to $1,500 in purchases each quarter on rotating categories after activation, and 1 percent thereafter. This card is a great option for those who want to earn cash back without paying an annual fee.

For your interest: Discover Card Credit Score Needed

Service Credit Union uses FICO 10 for approvals, which can be more challenging than FICO 9, especially for those with bankruptcies. FICO 10 was found to be harder on one person's bankruptcy than FICO 9.

FICO 10T would be even more unforgiving, but it's worth noting that FICO 8 and 9 have some quirks, such as allowing a balance on all cards for 23 months without negatively affecting the score. This might seem like an oversight, but it's essential to understand how different scores are weighted by lenders.

Some lenders, like Service Credit Union, update their scores quarterly using Experian data, which is the same score used for account management. For those with bankruptcies, the weight placed on the score can vary significantly between lenders, even if the score range is the same.

Related reading: Credit Union Personal Loan to Pay off Credit Cards

If you're looking for credit cards that use FICO score for approval, you might want to consider applying to cards matched to you. Cards labeled 'No Ding Decline' won't hurt your credit scores if you are not approved.

The Discover it Cash Back credit card requires only a good credit score to apply. Approval of your application will result in a hard inquiry, even if you're unable to pass final verifications, which may impact your credit scores.