While a multitude of factors impact a person's FICO credit score, they are broken down into five broad categories: payment history, amounts owed, length of credit history, new credit and types of credit used. Each factor has a different weighting in the overall score.
Payment history accounts for 35 percent. This category has the most impact as it demonstrates responsible borrowing over time. This factor assesses a person's consistency in making on-time payments to lenders. Late payments make a significant dent in a score. Amounts owed refers to balances on accounts. This factor accounts for 30 percent of the score. Debt-to-limit ratios on each card, and in sum, drive this category.
Length of credit history impacts 15 percent of a person's score. This factor looks at how long a person has used credit. It includes measurements of the oldest and newest credit accounts, as well as the average length of all accounts. New credit impacts 10 percent of the score and looks at the number of new applications and accounts for the consumer. Opening lots of new accounts in a short period is a concern for lenders. The last category, types of accounts, also impacts 10 percent of the score. It includes analysis of the various installment loans and revolving accounts of the borrower.