VantageScore on Wednesday announced the release of VantageScore 5.0, a new tri-bureau credit scoring model that the company says is designed to improve lenders’ ability to assess consumer creditworthiness, particularly for unsecured loans and auto financing.

The new model is available through the three major U.S. credit reporting companies — Equifax, Experian and TransUnion — and is built using post-pandemic consumer credit data. VantageScore said it better reflects changes in borrowing behavior since 2020.

According to the company’s press release, VantageScore 5.0 provides up to a 9% improvement in predictive performance for unsecured lending products — including credit cards, retail cards, personal loans and auto loans — compared with VantageScore 3.0.

“VantageScore 5.0 uses an innovative and simplified credit score model design that minimizes credit score migration, maintaining a more consistent credit score within an ever-changing credit environment,” the release stated. “VantageScore 5.0 also reduces variability across credit bureau files, ensuring 96% of scores remain within a 40-point range across all three bureaus.”

VantageScore claims that the new model, which is “optimized for unsecured lending and auto loans,” is the only nationwide tri-bureau credit score currently trained on post-pandemic consumer loan performance.

The company said the model incorporates new patent-pending credit attributes designed to provide lenders with more detailed insights into borrower risk. It also said the model is intended to produce more consistent credit scores over time and reduce differences in scores generated from the three national credit bureaus.

“The credit landscape has evolved rapidly,” Andrada Pacheco, VantageScore’s executive vice president and chief data scientist, said in a statement. “VantageScore 5.0 is at the forefront of a new generation of VantageScore credit scoring models built on today’s challenges and tomorrow’s opportunities.”

The release comes as competition in the credit scoring market has intensified. Federal housing regulators have recently expanded the use of newer credit scoring models in mortgage lending, including VantageScore 4.0 and FICO 10T.

This article was written by Sarah Wolak and generated with the assistance of HousingWire Automation, then reviewed by a HousingWire editor before publication.