Your FICO credit score is calculated from five weighted factors — payment history carries the most weight at 35%. Here's exactly how each factor works and what moves the needle fastest.
Your FICO credit score — the number most lenders use — is calculated from five weighted factors: payment history (35%), amounts owed (30%), length of credit history (15%), new credit inquiries (10%), and credit mix (10%). Scores range from 300 to 850. Payment history and utilization together account for 65% of your score.
Your credit score is calculated from five factors — each carrying a specific percentage weight. According to FICO's published credit education, the model breaks down as follows: payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%), and credit mix (10%). Scores range from 300 to 850.
FICO Score 8 is the version most lenders use. VantageScore — developed by the three major credit bureaus — uses the same 300–850 scale but weights factors differently and is used by some lenders and many free monitoring tools. Unless your lender specifies otherwise, assume FICO is the model being pulled.
Payment history is the single largest factor. It records whether you’ve paid accounts on time: credit cards, auto loans, mortgages, student loans, and personal loans. One 30-day late payment can drop a score above 740 by 60 to 100 points. The more recent the missed payment, the harder the impact.
What damages this factor: late payments, collections, charge-offs, foreclosures, and bankruptcies. Late payments stay on your report for seven years; Chapter 7 bankruptcy for ten. What helps: every on-time payment builds the record. Consistency is the only strategy.
The CFPB consumer credit guide explains how to dispute inaccurate late-payment records that appear on your file. Even one erroneous missed-payment notation can cost significant score points and is worth correcting.
“Amounts owed” refers primarily to your credit utilization ratio — the share of your total revolving credit limit that you’re currently using. If you have $10,000 in combined credit card limits and carry a $3,000 balance, your utilization is 30%.
Most scoring guidance suggests keeping utilization below 30%. The best scores typically reflect single-digit utilization. Utilization is recalculated each billing cycle when your card issuer reports your balance to the bureaus, making this the most controllable factor in the short term. Paying down a balance shows up in your score within one to two months.
Installment loan balances (mortgage, auto, student loan) also factor into amounts owed, but they carry less scoring weight than revolving utilization. For a detailed breakdown of how to calculate and lower your utilization ratio, see the credit utilization guide.
FICO looks at three age signals: the age of your oldest account, the average age of all accounts, and how recently each account was used. Longer histories, on average, produce better scores — a longer track record gives lenders more data to assess your patterns.
Two common mistakes damage this factor:
The practical rule: keep old, no-annual-fee cards open and occasionally use them for a small recurring charge.
When you apply for a new credit account, the lender pulls your credit report — a hard inquiry. Each hard inquiry typically costs 3 to 5 points for up to 12 months, then ages off your score.
FICO builds in a rate-shopping exception: multiple inquiries for the same loan type (mortgage, auto, student loan) within a 14- to 45-day window count as a single inquiry. This lets you compare lenders without accumulating score damage. The exception applies to installment loan shopping — not credit card applications.
Checking your own score through a bank dashboard or credit monitoring service is a soft inquiry with zero impact.
Lenders prefer to see that you can manage different types of credit simultaneously. FICO rewards a mix of revolving accounts (credit cards, lines of credit) and installment accounts (auto loans, mortgages, student loans, personal loans).
This factor carries the least weight and is the least actionable. Opening a new account type specifically to diversify your mix is rarely worth the inquiry cost and average-age reduction. Let mix develop naturally as you take on different financial products over time.
The FTC’s credit score consumer guide outlines your rights and explains how lenders use scores in lending decisions. Here is how standard FICO ranges correspond to borrowing outcomes:
| FICO Range | Tier | Practical Impact | |---|---|---| | 800–850 | Exceptional | Best available rates; rarely declined | | 740–799 | Very Good | Competitive rates on most products | | 670–739 | Good | Most mainstream loans accessible | | 580–669 | Fair | Higher rates; some product restrictions | | Below 580 | Poor | Secured products or significant terms restrictions |
The difference between a 620 and a 760 score on a 30-year $400,000 mortgage can translate to $150–$200 more per month in interest — over $60,000 across the life of the loan.
Most small business lenders pull your personal FICO score as part of underwriting — especially in the early years of a business. The Federal Reserve’s 2026 Small Business Credit Survey (2025 data) identified personal creditworthiness as one of the top factors lenders cite in approval decisions for small employer firms.
SBA 7(a) loans typically require a personal FICO score of 650 or higher. Business lines of credit from mainstream banks prefer 680+. Revenue-based financing and some equipment lenders work down to 580–620 when other underwriting signals — monthly bank deposits, collateral value — are strong.
For a complete picture of what lenders review beyond your credit score, see what lenders actually review before approving your business application. For specifics on how credit floors differ by product type, see how to get approved for a business line of credit.
Federal law entitles you to one free credit report from each bureau per year at AnnualCreditReport.com — but a report is not a score. Most major credit card issuers (Discover, Capital One, Citi, Chase, American Express) provide free FICO Score 8 access in their account dashboards. FICO’s own site offers direct access for a monthly fee.
For a step-by-step walkthrough of how to read your report and dispute errors that may be artificially suppressing your score, see how to read your credit report and dispute errors.
No. Viewing your own credit score — through a bank dashboard, credit monitoring service, or AnnualCreditReport.com — is a soft inquiry that has zero impact on your score. Only hard inquiries, generated when you apply for new credit, have a temporary effect (typically 3–5 points per inquiry).
The fastest lever is reducing credit card balances. Paying down revolving debt can improve your score within one billing cycle because credit utilization (30% of your score) is recalculated when issuers report your balance to the bureaus. Late payment damage fades gradually over time; collections and bankruptcies take 7–10 years to age off.
Most conventional small business lenders and SBA 7(a) programs prefer a personal FICO score of 650 or higher. Business lines of credit from mainstream banks typically require 680+. Revenue-based financing and some equipment lenders work down to 580–620 when monthly revenue and collateral are strong.
Often yes. Closing an old card removes its credit limit from your utilization calculation — raising your utilization ratio — and removes its age from your average account age. Both effects tend to lower your score. Keep old, no-annual-fee cards open and occasionally use them for a small recurring charge to prevent closure.
FICO (Fair Isaac Corporation) and VantageScore are the two dominant credit scoring models in the US. Both use a 300–850 scale and draw from the same credit bureau data. FICO Score 8 is the standard for most banks and lenders. VantageScore 4.0 is used by many free monitoring tools and — since 2025 — is accepted alongside FICO 10T for conventional mortgage underwriting by Fannie Mae and Freddie Mac.