What really affects your credit score?
 Everything in a particular scoring model either adds or subtracts points.
Your score is not based on just one factor. The weighting of each factor
can vary, depending on the other factors in your credit report.
The following chart shows the main credit
score factors, with each column being about a third of the total.
 Your
Payment Record |
Present
obligations |
History
and Activity |
|
On time?
What kinds of accounts were you late in paying? How late? Dollar amount
overdue? How many different accounts?
Any bankruptcies, judgments, suits, liens,
wage attachments or collection items? How recently?
Number of accounts with no late payments?
|
Total amount owed?
Total owed by category.
Are you actively using credit?
Are you current?
Number of accounts having balances.
Nearness to your credit limits.
Installment loan balances.
|
How much
history?
Age of oldest account.
Average age of accounts.
Length of inactivity on some accounts.
|
New
credit.
Multiple new accounts and/or requests for credit.
Trends in payment patterns.
|
|
How many and what kind of accounts:
Credit cards, retail accounts, installment
loans, finance company accounts and mortgage loans.
|
Note: We tell you what factors are affecting your credit score, based on
your personal credit report. You can see your credit
report, your credit score, and an analysis of the factors in a matter of
seconds by clicking here.
What really doesn't matter in credit scores?
Factors not statistically proven to predict credit risk are not included in the
score. Such factors would make credit scores less accurate - so there's no
payoff for anyone to include them.
The Equal Credit Opportunity Act prohibits basing credit decisions on
race, ethnic group, religion, gender, marital status, or national origin. These
are not included in your credit score. Credit scores also do not rate you
based on the neighborhood in which you live.
Age is not used in the major scoring models. Lenders are not allowed to
discriminate against elderly applicants.
Inquiries based on you seeking credit are included in your score, but inquiries
not related to your seeking credit are not included. For example, none
of the following affect your score:
- Checking your own credit
- Employers or prospective employers checking your credit
- Insurance company inquiries
- Credit inquiries for "pre-approved" promotional offers
- Account review inquiries
Only information actually on the credit report can affect your
credit score.
- Your income and bank balance aren't part of your credit score,
because they are not shown on your credit report.
- The interest rates you pay are not on your credit report, so they
are not part of your score. (Certain kinds of loans, however, such as those
in which you put up all your household furnishings as collateral, may
suggest you are having financial difficulties. These can lower your score.)
- Your occupation, job title, employer, time with the company, and
employment history do not count. (Employment history sometimes appears
on credit reports, but reporting of employment is often incomplete.)
| Important note: Individual
lenders may add income, bank account data, and other legally-permitted
information from your application in making a decision. The extra
information might be used in borderline cases only, or it might be part of
a custom scoring model developed specifically for the credit grantor's
needs. |
| |
|
