What Actually Affects Your Credit Score

Payment history: about 35%

Whether you paid past obligations on time, and how badly you did not. Severity and recency both matter: a 90-day late is worse than a 30-day late, and a recent one is worse than an old one. The damage from any single mark fades as it ages even though the record stays for seven years.

Because this factor is the heaviest, a late payment reported in the wrong month is one of the most expensive errors a report can carry. It also means the first derogatory mark on a clean file is a bigger relative hit than the fifth on a damaged one.

Amounts owed: about 30%, and mostly utilization

This is dominated by revolving utilization: your credit card balances as a percentage of your limits, both per card and overall. It is the fastest legitimate lever most people have, because unlike payment history it has no memory. Bring the balances down and the factor improves on the next reporting cycle.

Here is the detail almost nobody is told. Your balance is reported to the bureaus on your statement closing date, not your due date. If you charge $2,000 on a $3,000 limit and pay it in full every month, you have never been late and you are still reporting 67% utilization, because the statement cut before your payment. Paying down before the statement closes changes what the bureaus see without changing anything about how you use the card.

• Utilization has no memory. This month's number is what counts
• Your statement closing date, not your due date, is when the balance reports
• Both per-card and total utilization are evaluated
• Installment loan balances count here too, but carry far less weight than revolving

Length of credit history: 15%

The age of your oldest account, the average age of all accounts, and how long each has been active. You cannot accelerate this, but you can damage it, which is why the popular instinct to tidy up by closing unused cards usually backfires. Closing a card removes its limit from your utilization math immediately and eventually shortens your average account age.

A no-fee card you have had for eleven years is an asset. Put a small recurring charge on it, autopay it in full, and leave it alone.

New credit: 10%

Recent applications and newly opened accounts. Hard inquiries usually cost a few points each and fade within about a year, though the record stays visible for two. Rate shopping for a mortgage, auto loan, or student loan inside a short window is deliberately scored as a single inquiry, so comparing lenders is not the risk people believe it is.

Applying for several credit cards in a month is a different signal and is treated as one. And an inquiry from a company you never authorized to pull you does not belong on your report at all.

Credit mix: 10%

Whether you have experience with both revolving accounts and installment loans. It is a genuine factor and a small one. Nobody should take out a loan they do not need in order to improve their credit mix, which is advice that gets given more often than it should be.

The score you see is probably not the score they pull

There is no single credit score. There are dozens of FICO versions plus VantageScore, and lenders choose which to pull by industry. Mortgage underwriting still commonly relies on older FICO versions. Auto lenders use auto-specific variants that weight your auto history more heavily. Card issuers use bankcard variants. The number in your banking app is usually a VantageScore or an educational FICO, and it is directionally useful rather than decisive.

This is why a 40-point gap between what your app shows and what a lender quotes is not evidence that someone made a mistake. If a specific loan is the goal, the question worth asking your loan officer is which score version and which bureau they will pull.

What is not in your score at all

Your income, your employment, your savings, your assets, your age, your race, your marital status, your religion, and where you live are not inputs to your credit score. Lenders may consider some of those separately in underwriting, and some of them they may not consider at all, but none of them are in the score itself. Neither is checking your own credit, which is a soft inquiry with no effect whatsoever.

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