Credit Scores Explained
What Affects Yours & How to Improve It
Your FICO score controls your interest rates, loan approvals, apartment applications, and more. Understanding what drives it — and what's dragging it down — is the first step to fixing it.
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FICO Score Ranges
FICO scores range from 300–850. Most lenders consider 670+ to be a qualifying score for standard loan products.
The 5 Factors That Make Up Your Credit Score
FICO scores are calculated from these 5 factors. Payment history and utilization together account for 65% of your score.
Payment History
Whether you pay on time. A single 30-day late payment can drop a 780 score by 90–110 points.
Amounts Owed
How much of your available credit you are using. Keep credit card utilization below 30% — ideally below 10%.
Length of History
How long your accounts have been open. Older accounts help your score — avoid closing old credit cards.
New Credit
Recent hard inquiries and new accounts. Each application can drop your score 5–10 points.
Credit Mix
Variety of account types — credit cards, auto loans, mortgage, installment loans. Diversity helps.
What Hurts Your Score vs. What Helps It
What Hurts Your Score
- ✕Late or missed payments
- ✕High credit card balances (high utilization)
- ✕Collections, charge-offs, repossessions
- ✕Bankruptcy or foreclosure
- ✕Too many hard inquiries
- ✕Closing old credit cards
- ✕Maxed-out credit cards
- ✕Accounts in collections
What Helps Your Score
- ✓Paying on time, every time
- ✓Keeping utilization below 10%
- ✓Disputing and removing inaccurate items
- ✓Keeping old accounts open
- ✓Becoming an authorized user on a good account
- ✓Diversifying your credit mix
- ✓Paying down balances before statement close
- ✓Avoiding unnecessary new applications
Have Inaccurate Items Dragging Your Score Down?
Removing inaccurate negative items is the fastest way to improve a credit score. Book a free strategy call — we'll pull your 3-bureau report and identify every disputable item at no charge.
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What is a good credit score?
FICO scores range from 300–850. 670+ is generally considered good. 740+ qualifies for the best mortgage rates. 800+ is exceptional. Individual lender requirements vary.
What factors affect your credit score?
Payment history (35%), amounts owed/utilization (30%), length of history (15%), new credit (10%), credit mix (10%). Payment history and utilization together are 65% of your score.
Why did my credit score drop?
Most common causes: new late payment, new collection, new hard inquiry, higher credit card balances, closing an old card, or a new derogatory item. Check your report for new negative items or errors.
How can I improve my credit score fast?
Fastest methods: (1) Dispute inaccurate negative items — removal is immediate. (2) Pay down credit card balances to reduce utilization. (3) Make all payments on time. Individual results vary.
How long does it take to rebuild a credit score?
If damage is from inaccurate items that can be disputed, improvement can happen within weeks. Accurate negative items take 12–24 months of consistent on-time payments and low utilization. Individual results vary.
What credit score do I need to buy a house?
Most conventional lenders require 620+. FHA requires 580+ (3.5% down). The higher your score, the better your rate — the difference between 620 and 740 can mean tens of thousands in interest over a mortgage.
Ready to Improve Your Credit Score?
Book your free strategy call. We'll pull your 3-bureau report, identify every inaccurate item, and walk you through exactly what we can do — at no charge and with no obligation.
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