Navigation
Rate Highlights
Improve Your Score
Building a solid credit history takes time. You must demonstrate responsible use of credit over a period of time. Understanding credit score factors will help you build a solid credit score.
- Pay bills on time. Your payment history counts toward 35% of the scoring calculation. Make more than the minimum payment on credit cards.
- Limit your debt. The total amount you owe represents 30% of your score. Credit card balances which are greater than a quarter to a third of your credit limit for that card will reduce your score. Having additional borrowing capacity is important for a good score.
- Acquire a solid credit history with ample years of experience. The average age of your accounts counts for 15% of your score. If you have older accounts, even though they may not have a balance, leave them open. This will contribute to a good credit score.
- Limit your credit applications. New credit represents 10% of your score. Opening several new accounts within the most recent 12-18 month period reduces your score, especially if you don't have a long credit history. Auto and mortgage requests that occur within a very short period of time, however, are considered one inquiry. It is understood that you may be shopping for the best loan.
- Use a variety of types of credit. Types of credit accounts for another 10% of your score. A major credit card, a gas card, a line of credit and perhaps an installment loan (such as a car loan) demonstrates your ability to handle various types of payment options.
- Dispute mistakes. Review your credit reports annually to keep them accurate. Errors have the potential to affect your score.
WHAT IS NOT FACTORED INTO YOUR CREDIT REPORT
- Race, religion, where you live, number of children or debt ratio.
To learn more, try our free interactive Credit Management Coach.
