What Makes Up Your Credit Score?

In this post we are going to briefly explore and talk about credit score factors. When working with hard money lenders, what your credit was did not used to make much of a difference. These days, however a lot has changed, and even in the hard money lending environment, your credit is playing a larger role in lending decisions.

Many people are in the dark when it comes to all of the various factors that go into their credit score. We have put together a fast cheat sheet on credit score factors:

35% of any credit score comes from payment history. This is the biggest of the credit score factors, and the newest payment history is the most important. The items that make up this category are

• Tax Liens
• Bankruptcies
• Late payments
• Judgements

The next largest chunk of your credit score comes from accounts owed. Credit cards, first, second and third mortgages, auto loans, equity lines of credit and boat loans all factor into this part of your credit score.

15% of your credit score comes from the length of time your credit history shows, how long your various accounts and debts have been open in other words.

10% comes from new activity. Having your credit run falls under this section.

Finally, the last of your score comes from the kind of credit that you have utilized.

Written by admin on March 2nd, 2010 with no comments.
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