What Makes For A Credit Score

Have you ever tried getting a letter coming from your credit agency that displays your credit score and the question running through your mind is how did it come about? That’s the usual case a credit holder is experiencing when he or she sees how low their standing is.

First off, you must realize that your current credit score will rely upon your past payments. This makes up for 35% of your overall credit score. If you have been religious with your payments, then no further questions will be asked. Bad news if you have missed a couple of due dates. Different creditors have different standards when it comes to when they will be accounting a late payment. That said, it’s still best to do timely payments.

Second, the 10% of your score will be coming from your variety of credit. This would only mean having different categories like car loan, house rents or simple credit cards display your capability to handle a myriad of credit options, given you keep in mind to pay all of them.

Third thing to know is that 15 % of your credit score will be taken from how long you have a history of credits. The better you have handled them in the past years, the better your score would turn out.

Fourth, 30% comes from the overall amount of the balance you owe. It will be weighed parallel to your income. So, see to it that you make your debt lower than your income to keep your score afloat.

And of course, 10% of the credit score makes up for what you owe from inquiries with regard to your credit. This could mean an overdue or a forgotten due date.

You can trace back this mysteriously low credit score to the credit holder’s lost of control and lack of knowledge. It’s tempting to blame the credit agency for not informing you ahead, but you have to accept the fact that you’re responsible for the kind of position you are presently on.