Your FICO Score
The Five Key Factors
FICO Scores are calculated using five main components:
- Payment History (35%): Have you paid your bills on time? Late payments lower your score.
- Amounts Owed (30%): How much debt do you have compared to your available credit? This is called credit utilization.
- Length of Credit History (15%): How long have you had credit? Longer histories are better.
- Credit Mix (10%): Do you have a variety of credit types, like credit cards, loans, and mortgages?
- New Credit (10%): Opening several accounts in a short period can lower your score.
Tips to Improve Your FICO Score
- Always pay at least the minimum balance on time.
- Keep your credit utilization below 30%.
- Avoid opening too many accounts at once.
- Regularly check your credit report for errors.