Many times a borrower has asked “why is my credit score only ###”? The answer will depend on the credit profile – here’s the breakdown:
35% – payment history : paying your bills on time is 1st primary factor
30% – amount owe/ credit balance : not having all your credit cards max out/close to limit is 2nd primary factor
15% – length of your credit history/how long each tradeline has been opened : long history is good, don’t be closing all old, old credit cards
10% – new credit line opened/credit inquries : everyone wants to give you a line of credit, all will check your credit, don’t have excess inquiries
10% – type of credit opened : a good mix of credit is good, credit card, installment loan, mortgage, etc…
Joon Choi – Senior Loan Officer @ Chicago Financial Services, Inc.