Uncategorized December 10, 2016

5 Factors That Decide Your Credit Score

Credit scores fall within the following range: 200-800. Scores above 620 are considered desirable for obtaining a mortgage. It is possible to get a mortgage with a lower credit score, though generally these loans are far less favorable to the buyer. I have listed five factors which will affect your score.

  1. Payment history — whether you paid credit card or loan obligations on time.
  2. Debt. The amount of debt and the number of accounts the debt is under are key contributing factors.
  3. The length of your credit history. As a rule of thumb, the longer the better.
  4. How much new credit you have. New credit, either installment payments or new credit cards, are considered more risky, even if you pay promptly.
  5. The types of credit you use. Generally, it’s desirable to have more than one type of credit—installment loans, credit cards, and a mortgage, for example.

For more on evaluating and understanding your credit score, go to http://www.myfico.com .