Put Fight in Your Fico Credit Report Score
Contributed by Roland Head
What does the score on your credit report mean
Credit report scores indicate the level of credibility you have with credit. If that sounds like a tongue-twister, the actual meaning of your credit score is more straight-forward. They really are a compilation of your credit history put into a score that holds meaning for would-be creditors.
What is my credit report score based on
Your score is based on five factors according to Fair Issac Corporation after whom the name FICO score is based on. (Note: A FICO score is another name for credit score.)
The five factors are as follow:
1. Your payment history-about 35% of your score.
This is the history you have of either paying bills on time or being late. Other things such as bankruptcy are included. A solid record of on-time payments elevates your score.
2. How much you owe - about 30% of your score
Credit report scores take into account all the amounts you have outstanding. This includes all your credit balances as well as the amounts of credit you are using compared to your total available credit. A larger amount of outstanding credit will lower your score.
3. Length of credit history - about 15% of your score
Longer histories on your credit report, when the history is favorable, translate into better credit scores. Nonetheless, if you have an outstanding record, even if it's short, you may get a top score.
4. New credit - about 10% of your score
Your credit report history will be weighed against the amount of new credit you are seeking. Scores distinguish between the search for a single loan versus a helter-skelter approach to seeking numerous and varied sources of credit. Hint: When seeking a loan narrow your parameters to keep a low score.
5. Other factors - about 10% of your score
