Your FICO Score is determined by calculation from several pieces of credit information in your credit report. The data is divided into 5 categories as displayed in the chart below. The percentages listed in the chart reflect how important of each of the categories is in determining how your FICO Score is calculated. A FICO Score considers both positive and negative information from your credit report.
It is impossible to measure the impact of a single factor in how your score is calculated without looking at your credit report. The levels of importance shown in the chart above are for the general population and will be different for all different types of credit profiles.
Some of the following things that you can work on to help your FICO Score include:
- Maintain a good track record of making your payments on-time. Late payments will lower your FICO Score.
- Maintain established credit accounts. Having credit accounts for a longer period of time raises a FICO Score.
- Get a copy of your credit report each year and check for any potential errors. Clear up any errors quickly to avoid negative impacts to your score.
- Minimize the number of credit inquiries to your report. Applying for many credit cards or lines of credit at once can reduce your score.
- Reduce the amount of debt that you owe.
- Keep the balances low on credit cards or other sources of “revolving credit”.
Your FICO Score is an important piece of information to determine your ability to qualify for a mortgage to purchase a home. It is important to be mindful of your score and to follow the advice provided by your mortgage lender or financial advisor. It is also important to know that your credit score is unique to you and your score calculation depends on the overall information in your report. One factor may have a larger impact than it would for someone with a much different credit history.