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FICO Scores and your credit makeup

Joshua Dorkin
1 min read

Someone today asked me about FICO scores, and we had a great talk. I thought I’d reprint a post from the forums to help you all out. Toney posted the following, which has some great info.

The components of FICO are:

Payment History – 35%
Amounts Owed – 30%
Length of Credit History – 15%
New Credit – 10%
Types of Credit Used – 10%

What can affect your score?

1 – High outstanding debts – keep balances low on credit cards and other revolving credit.
2 – Late payments – note that paying off collction accounts will not remove them from your report. These accounts will stay on for seven years unless you get a letter of deletion from the collector.
3 – New accounts – If you’ve been managing credit for a short time, don’t open too many new accounts too rapidly

Note By BiggerPockets: These are opinions written by the author and do not necessarily represent the opinions of BiggerPockets.