Know accurately how credit scores are calculated and what really affect your credit score and how much.

1. How Credit Score is Calculated?

2. Credit score calculation Model

3. Payment History is 35%
Payment history
has the highest
impact on your
credit report
Advice : Pay your bills on time

4. Amount Owed/Debt to limit Ratio is 30%
Lenders and credit bureaus look
at the amount of debt you owe
relative to the amount of
available credit.
Advice: Keep your
credit balance low

5. Length of Credit History is 15%
Short history is looked
at as a credit risk
because there’s no
proven record. There
is no reason to ever
close any account
because the longer the
account is open the
more it helps increase
your score.
Advice: Keep your old accounts open

6. Types of Credit Used is 10%
Credit bureaus
look at how many
different types of
credit you
currently use and
have used in the
past, such as
credit cards,
mortgage, car
loan, retail
accounts, etc.
Advice: Manage different types of accounts.

7. New Credit is 10%
Too many credit
applications mean that
you are taking lot of debt
& are in financial trouble
Advice: Don’t
apply for multiple
credit lines.

8. Check your credit score on regular basis
&
Keep it high for a good financial life
Info Source: www.Creditscore.com