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Factors that affect your credit score and their weighting

Credit score rating are calculated base on a lot of different credit data in your credit report. This data can be grouped into five categories as outlined below. The percentages and how important each of the categories is determining your credit score.   The is a rough estimation of percentage contributed by each group.

  • Payment History - 35%

  • Amounts Owed - 30%

  • Length Of Credit History - 15%

  • New Credit - 10%

  • Types of Credit Used - 10%

These percentages are based on the importance of the five categories for the general population. For particular groups - for example, people who have not been using credit long - the importance of these categories may be somewhat different

Payment History

  • Account payment information on specific types of accounts (credit cards, retail accounts, finance company accounts, mortgage, etc.) is an importing factor in credit score rating.

  • Presence of adverse public records (bankruptcy, judgements, suits, liens, wage attachments, etc.), collection items, and/or delinquency (past due items)

  • Severity of delinquency (how long past due)

  • Number of past due items on file

  • Number of accounts paid as agreed

Amounts Owed

  • Amount owing on accounts

  • Amount owing on specific types of accounts

  • Lack of a specific type of balance, in some cases

  • Number of accounts with balances

  • Proportion of credit lines used (proportion of balances to total credit limits on certain types of revolving accounts)

  • Proportion of installment loan amounts still owing (proportion of balance to original loan amount on certain types of installment loans)

Length of Credit History

  • Time since accounts opened

  • Time since accounts opened, by specific type of account

  • Time since account activity

New Credit

  • Number of recently opened accounts, and proportion of accounts that are recently opened, by type of account

  • Number of recent credit inquiries

  • Time since recent account opening(s), by type of account

  • Time since credit inquiry(s)

  • Re-establishment of positive credit history following past payment problems

Types of Credit Used

  • Number of (presence, prevalence, and recent information on) various types of accounts (credit cards, retail accounts, installment loans, mortgage, consumer finance accounts, etc.) is one of the final factor considered in your credit score rating.

It is important to note that a credit score rating takes into consideration all these categories of information, not just one or two.  However, lenders look at many things when making a credit decision including your income, how long you have worked at your present job and the kind of credit you are requesting.

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