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NewsWhat Affects Your Credit Score?5/01/2008
How is your credit score determined?
- Your payment history. Late payments reduce your score, so always pay your bills on time.
- Your total debt. Do you have lots of debt? Multiple credit cards that are maxed out, plus car loan, mortgage and equity line? High debt will reduce your credit score, too.
- Your credit history. The longer it is, the better for your score.
- Your credit types. The wider the variety of credit you have, the more you demonstrate your ability to handle debt well.
- Your seeking new credit. If you apply for and receive a lot of credit (e.g., opening several credit cards, taking installment loans), you come across as a credit risk and your score is also reduced.
Your safest course of action is to have credit, but keep it to a minimum and never miss or be late with any payments.
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