How is my credit score determined?

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Street Address 4750 S. Biltmore Lane, Madison, WI
City Madison
State Wisconsin
Country United States
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There are five main factors that determine your credit score, each one weighing differently. The five main factors are:

Payment History – 35%

  • Paying debt on time and in full has a positive impact.
  • Late payment, judgments and charge-offs have a negative impact.

Outstanding Credit Balances – 30%

  • Keep balances below 50% of limit – below 30% is even wiser. Do NOT close accounts.
  • Pay outstanding debt down as close to zero as possible.
  • Evenly redistribute the remaining balance among open lines.

Length of Credit History – 15%

  • The length of time a particular credit line has been opened is important. A seasoned borrower is stronger.

Types of Credit (Healthy Mix) – 10%

  • A mix of auto loans, credit cards and mortgages is positive- rather than a concentration in credit cards only.

New Inquiries – 10%

  • Don’t “over-apply” for credit.
  • Auto and mortgage inquiries receive special treatment, and 20 inquiries can be made in a 14-day period and will be treated as only one inquiry.
  • Each hard inquiry can cost 2-50 points on a credit score.

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