Understanding Your Credit Score
A higher score starts with understanding the factors that credit scoring agencies use to evaluate you.
FICO® Score Calculation Factors
Your FICO® score is compiled from five primary categories of data. Improving these categories is the core focus of your credit path.
Whether payments have been made on time. Late payments, charge-offs, and defaults have the heaviest negative impact here.
The ratio of your outstanding balance to your total available credit. Keeping this ratio under 30% is highly recommended.
The age of your oldest and newest accounts, along with the average age of all your accounts combined.
Applying for multiple new accounts in a short period triggers hard inquiries, which temporarily lowers your score.
Having a healthy balance of installment loans (car loan, mortgage) and revolving credit (credit cards).
Essential Credit Rebuilding Tips
Automate Minimum Payments
Ensure late payments are avoided by configuring auto-payments on all active revolving and installment lines.
Keep Old Accounts Open
Closing unused cards shortens your credit history length and lowers total available credit limit, negatively impacting utilization ratios.
Request Credit Limit Increases
Asking for a higher credit limit on your cards without adding debt helps lower your credit utilization percentage automatically.