What Factors Impact My Credit Score and How Can I Improve My Credit Score?

Your FICO® scores, from Fair Isaac and Company, are the credit scores most lenders use to determine your credit risk. You have three FICO® scores; one for each of the three credit bureaus – Experian, TransUnion and Equifax. Each credit score is based on information the credit bureau keeps on file about you. As this information changes, your credit scores tend to change as well.

The following information is provided as an educational resource. We strongly advise you to seek professional advice to understand your particular circumstances prior to making any decisions.

Credit scores factor in five main kinds of credit information. Listed from most important to least important, these include:
  • Payment history
  • Amount owed
  • Length of credit history
  • New credit
  • Types of credit in use
Things not considered when computing credit scores include:
  • Race, color, religion, national origin, sex or marital status
  • Age
  • Salary, occupation, title, employer, date employed or employment history
  • Where you live
  • Any interest rate being charged on a particular credit card or other account
  • Certain types of inquiries (such as promotional, account review, insurance or employment-related inquiries)
  • Any information not found in your credit report
Things you can do to improve your credit score:
  • Pay all bills on time – Just one or two late payment(s) can adversely impact your score.
  • Keep balances low on credit cards and other revolving credit products. A common rule of thumb is to keep your balance below half your credit limit.
  • Apply for and open new credit accounts only as needed.
  • Review your credit report at least once a year from the three major credit reporting agencies (Equifax, Experian and TransUnion) and contact them if you believe that your credit report contains inaccuracies. You are entitled to a free credit report each year from each of the three credit bureaus. You can request these reports through www.annualcreditreport.com.

If you'd like more information about building your credit and improving your credit score, take advantage of free credit report review and education through our partnership with BALANCE, a national nonprofit organization. BALANCE's counselors are experts in personal finance and credit. Contact a BALANCE counselor at 888.456.2227, or visit the BALANCE website.