How Important is Your Credit Score?
What’s in a Score?
35% based on payment history
30% capacity (How much do you have available?)
15% for length of credit
10% for accumulation of debt in the last 12-18 months
10% for the mix of installments vs. revolving credit.
What's Not Included
Debt ratio
Income
Length of residence
Length of employment
What helps your score?
Pay down your credit cards!
Do not close credit cards
Make current payments on time
Slow down on opening new accounts
Work on acquiring a solid credit history with years of experience!
What hurts your Score?
Missing payments-it takes 24 months to recover from a late payment
Maxing out credit cards
Closing out credit cards
Opening numerous accounts
Having more revolving loans than installment loans
The NOW is most important – so make your current payments on time!
Credit weight for each year:
40% ~ current to 12 months
30% ~ 13-24 months
20% ~ 25-36 months
10% ~ 37+ months
