Budgeting Financial Planning What Is Your Beacon Credit Score? By Rebecca Lake Updated on November 18, 2021 Reviewed by Margaret James Reviewed by Margaret James Twitter Peggy James is an expert in accounting, corporate finance, and personal finance. She is a certified public accountant who owns her own accounting firm, where she serves small businesses, nonprofits, solopreneurs, freelancers, and individuals. learn about our financial review board In This Article View All In This Article Definition and Examples of Beacon Scores How Beacon Scores Work Beacon Scores vs. Other Credit Scores Photo: Weekend Images Inc. / Getty Images Definition The Beacon credit score is a scoring model developed by Equifax. Based on the FICO credit scoring model, these scores use a unique algorithm to measure a consumer's creditworthiness based on their past financial history. Key Takeaways Beacon credit scores are another name for Equifax versions of FICO credit scores.FICO credit scores are the most widely used among lenders for credit approval decisions.Paying bills on time and maintaining low balances relative to your credit card limits can help you improve your credit scores.Lenders may use Beacon scores, alongside other credit scoring models, when deciding whether to approve you for loans.The higher your credit score, the more likely you are to get approved for loans at the best interest rates. Definition and Examples of Beacon Scores Beacon, sometimes stylized as BEACON, is the Equifax brand name for FICO credit scores. FICO scores, which are used by 90% of top lenders, are issued by the Fair Isaac Corporation. Beacon scores are based on personal financial information included in Equifax credit reports. Lenders may use different versions of the Beacon credit scoring model when deciding whether to approve you for loans or lines of credit. For example, Fannie Mae’s mortgage underwriting process uses the Equifax Beacon 5.0 score, along with the Experian/Fair Isaac Risk Model V2SM, and the TransUnion FICO Risk Score, Classic 04. In 2009, Beacon 09 was introduced as the Equifax version of the FICO 08 credit score. Note Beacon scores and FICO scores are separate from VantageScores, which are part of a credit scoring model developed jointly by Equifax, Experian, and TransUnion. How Beacon Scores Work Beacon credit scores are calculated using a proprietary model Equifax doesn't disclose. But since Beacon 5.0 and Beacon 09 are based on FICO’s methodology, they use the same criteria for tabulating scores. Here's how FICO credit scores are calculated: Payment history: 35% of your scoreAmounts owed: 30% of your scoreLength of credit history: 15% of your scoreNew credit: 10% of your scoreTypes of credit used: 10% of your score With that in mind, the best ways to improve your Beacon score (and FICO score) include paying bills on time and maintaining low credit utilization. You can also help your score by keeping older accounts open, using a mix of credit types, and applying for new credit sparingly. As mentioned, Beacon 5.0 is used by Fannie Mae for mortgage underwriting. Beacon 09, which is based on FICO 08, may be used in other types of lending decisions. For example, if you apply for a credit card or a car loan, the lender could check your Beacon 09 score or FICO 08 score. Again, the higher your scores, the more likely you are to be approved and get the best interest rates. Lenders can determine which credit score model to use for approval decisions. It's possible that they may use more than one credit scoring option, as is common with mortgage lending. Keep in mind that your credit scores may differ from one credit bureau to another, depending on the information in your credit reports. Note Checking your own credit scores won't trigger a hard inquiry on your credit report or cost you credit score points. Beacon Scores vs. Other Credit Scores Generally speaking, Beacon scores can be used to measure risk when extending credit or loans. This is true for other types of credit scores as well, including variations of FICO scores and VantageScores. But credit scores can vary in terms of how they analyze risk and which factors they take into account. With FICO 08, for instance, the emphasis is on predicting default rates and how likely a consumer is to pay back a loan or line of credit. Equifax's Pinnacle score is a “next generation” model that uses more than 80 variables to measure and predict lending risk. Equifax also has a separate score model for gauging how likely someone is to file bankruptcy. Then there are VantageScores, which incorporate many of the same factors as the FICO scoring model. But VantageScore 3.0 uses alternative data, such as rent and utility payments, that other scoring models don't consider. VantageScore 4.0 also includes trended data, such as your payment history over time. The bottom line? Beacon credit scores are just one type of credit score you may have. FICO scores may be most widely used, but you can get a clearer picture of how lenders see you by comparing your scores across different models. Note Check your credit reports regularly and dispute any errors you find so they can be corrected or removed. Was this page helpful? Thanks for your feedback! Tell us why! Other Submit Sources The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy. myFICO. "FICO Score, The Score That Matters." FICO. "Equifax and FICO Introduce BEACON 09 Credit Score."