Credit score bootcamp

Learn more about your credit score. Whether you're getting started or getting back on track, I can help you better understand your credit score.

Do you ever wonder what’s going on behind the scenes of your credit score?

Here’s a brief guide to help you understand:

How your credit score is calculated?
What the numbers mean?
What influences your credit score?

What is a credit score?

A credit score is a three-digit number, typically between 300 and 850, which is designed to represent your credit risk, or the likelihood you will pay your bills on time. In general, a higher credit score represents a higher likelihood of responsible financial habits. Credit scores are one of many factors used by lenders when determining your likelihood of paying back a loan.

Credit scores are calculated using the content of your credit report. Each of the three nationwide credit bureaus uses a slightly different method of determining your score.

What factors make up the scoring model of my credit score?

Let's get started!

Payment history: 35%

Your credit history includes information about how you have repaid the credit you have already been extended. It includes the number and type of credit accounts that you paid on time, details on late or missed payments, and how many of your credit accounts are delinquent in relation to all of your accounts on file. It also includes details on public records and collection items, including bankruptcies, foreclosures, wage garnishments, and any delinquencies that were reported to collection agencies.

Used credit vs. available credit: 30%

Your credit score analyzes how much of your total credit amount is being used, and how much you currently owe.

Type of credit used: 15%

Your credit score reflects the different types of credit accounts you have, including revolving debt (such as credit cards) and installment loans (such as mortgages, home equity loans, auto loans, student loans, and personal loans). Lenders and creditors look at how many of each type of account you have, to see that you’re able to manage multiple accounts of different types.

New credit: 10-12%

Your credit score reflects how many new credit accounts you’ve opened compared with the total number of accounts in your credit report. It takes into account how many recent requests for credit you initiated, as indicated by inquiries by creditors to credit reporting companies. Your credit score does not take into account requests a creditor has made for your credit report in order to make a preapproved credit offer, or to review your account you already have with them, nor does it take into account your own request for a copy of your credit history. Your credit score will factor in the length of time since creditors made credit report inquiries.

Length of credit history: 5-7%

This section details how long you’ve had your credit accounts. The credit score calculation includes both how long your oldest and most recent accounts have been open. In general, creditors like to see that you’ve been able to properly handle credit accounts over a period of time.

Let's get started - Here is your day to day plan

Disclaimer

Sorry to start with a disclaimer. There is some important information I need to pass on to you. First, there are many credit companies and that calculate your credit differently. Second, the criteria for your credit score can change. Despite my best efforts, some information may be incorrect. If you feel any information is inaccurate, please contact me.

Go to step one --->