How Is Your FICO (Fair Isaac Corporation) Score Calculated?

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• Payment history - about 35 % of your FICO score. On‑time payments raise the score; missed or late bills pull it down (see 'how your payment history affects your FICO').
• Amounts owed / credit utilization - roughly 30 %. Keeping balances below 30 % of each limit improves the score (details in 'how your credit utilization ratio is calculated').
• Length of credit history - around 15 %. Older accounts and a long average age add points; a very new history offers less benefit (covered in 'how the length of your credit history influences your score').
• New credit - about 10 %. Recent openings and hard inquiries temporarily depress the score; the effect fades over time.
• Credit mix - roughly 10 %. A blend of revolving cards, installment loans, and other credit types signals responsible handling and can boost the score.

Payment history drives roughly 35% of your FICO score, making it the single biggest factor. Every on‑time payment adds a small boost, while any late or missed payment subtracts points; the later the payment, the larger the hit.

Severity, frequency, and recency matter: a 30‑day delinquency can drop a score by dozens of points, a 90‑day delinquency can shave off a hundred or more, and each negative mark stays on the report up to seven years, though its influence fades over time. Consistently paying on schedule builds a solid positive track record that offsets minor slips and sets the stage for the next factor - collections, liens, and bankruptcies - to be examined.

Collections, tax liens, and bankruptcies all register as serious derogatory events and therefore knock down the payment‑history portion of your FICO score (about 35% of the overall model).

• Collection account: shows up as a negative entry, remains on your report for 7 years, and can drop your score roughly 100 - 150 points, with larger, newer collections causing the biggest hit.
• Tax or other lien: recorded as a public‑record item, also stays for 7 years, and generally harms the score more than a standard collection, often shaving 150 - 200 points.
• Bankruptcy: Chapter 7 stays for 10 years, Chapter 13 for 7 years; both can reduce the score by 200 - 300 points, especially when filed recently.

Credit utilization ratio measures the percentage of your revolving credit that's currently charged; you calculate it by dividing total credit‑card balances by total credit‑card limits and multiplying by 100. The result, reported each billing cycle, feeds into the 'amounts owed' factor that contributes about 30% of your FICO score.

For example, if Card A has a $500 balance on a $2,000 limit (25% used) and Card B shows a $300 balance on a $1,000 limit (30% used), add the balances ($800) and the limits ($3,000). $800 ÷ $3,000 × 100 = 26.7% overall utilization.

Keeping the combined ratio below 30% - ideally under 10% usually supports a higher FICO score, while a single card at 90% can drag the overall figure up even if other cards are low. See What credit utilization means for more details.

Length of credit history accounts for about 15 % of a FICO score; the older the average age of accounts and the earlier the oldest account opened, the more positive the impact. Lenders interpret a longer track record as proof of consistent borrowing behavior, which complements the payment history and credit utilization factors discussed earlier.

For example, a borrower whose oldest credit line dates back 10 years and whose average age sits around 7 years typically sees a 20‑30‑point boost within the 15 % slice, whereas a similar profile with a 2‑year‑old history may lose those points. Closing an old account shortens the average age and can therefore trim the score, a point you'll revisit when we cover new accounts and hard inquiries later.

New accounts and hard inquiries can lower your FICO score, usually by a few points, because they feed the 10 % new‑credit factor. A hard pull from a loan or credit‑card application may shave off 5 - 10 points, and opening a fresh account often reduces the average age of your credit history, which can cause a similar dip.

After the initial drop, a new account can boost your score if it raises total credit limits, lowers your utilization ratio, and adds a different type of credit to your profile. Those benefits align with the utilization and credit‑mix factors discussed earlier, and they typically appear after six to twelve months of on‑time payments, setting the stage for the next section on why credit mix matters.

Credit mix still affects your FICO score because the model rewards handling several credit types, even when those accounts are all credit cards. It represents roughly 10 % of the overall calculation, so ignoring it can leave a modest point boost on the table.

When you only have cards, you can still create a diverse mix by varying the card characteristics:

• Secured credit cards - they function like a small, fixed‑amount loan.
• Low‑interest revolving cards - show long‑term balance management.
• Rewards or charge cards with no balance - demonstrate high‑credit‑line usage without carrying debt.
• Retail store cards versus major‑issuer cards - add different issuing institutions.

A broader mix signals to lenders that you can manage distinct credit products, which can smooth score swings and marginally lift the final number, complementing the larger factors discussed earlier such as payment history and utilization.

FICO scores exist in several versions, each tweaking the proprietary algorithm while keeping the five‑factor formula - payment history ≈ 35%, amounts owed ≈ 30%, length of history ≈ 15%, new credit ≈ 10%, credit mix ≈ 10% - essentially the same framework discussed earlier.

The workhorse for most big‑bank credit‑card and auto lenders is FICO 8. A subset of premium cards uses FICO 9 because it reduces the impact of medical collections. Mortgage lenders still rely on legacy versions (FICO 2, 4, 5) to satisfy government‑backed loan requirements. The newest models - FICO 10, 10 T, and FICO 11 - appear with fintechs and a few modern credit‑card programs that incorporate real‑time data.

Your lender will disclose the exact version at application, and many credit‑monitoring tools now let you view scores across versions; check the official explanation of FICO score versions to see which applies to your product.

Pull your free credit reports from the official source. Then dispute any mistake directly with the credit bureaus.

1. Visit Free annual credit reports and request the three major bureaus (Equifax, Experian, TransUnion). The reports arrive as PDFs or online dashboards you can scroll instantly.
2. Scan each section - personal data, account listings, balances, payment status - against your own records. Mistakes often appear as misspelled names, wrong addresses, duplicate accounts, or outdated 'paid' flags that still show as 'late.'
3. Highlight every inaccuracy and gather supporting documents: bank statements, paid‑off letters, or settlement agreements. Keep a digital folder; you'll attach these files to your dispute.
4. File an online dispute with the bureau that listed the error. Use the bureau's portal, enter the account number, describe the problem, and upload your proof. The system acknowledges receipt within minutes.
5. The bureau must investigate within 30 days. While it's pending, they place a 'disputed' flag on the item, preventing it from influencing your FICO score calculation (see the payment‑history and amounts‑owed sections earlier).
6. Review the results when the bureau closes the case. If they correct the item, download the updated report and confirm the change no longer drags down your score.
7. If the bureau rejects your claim, send a certified‑mail 're‑investigation' letter to the creditor, attaching the same documentation. The creditor must re‑verify the data and report back.
8. Should the error persist, file a complaint with the Consumer Financial Protection Bureau or your state attorney‑general. Their oversight often speeds a final correction.

Thin files, authorized‑user status, and identity theft each produce a unique, approximate impact on your FICO score.

Because the model weighs payment history (≈35%), amounts owed (≈30%), length of history (≈15%), new credit (≈10%) and credit mix (≈10%), any deviation in these pillars shows up differently.

• Thin files - With fewer than three tradelines, the score has limited data; the algorithm may assign a lower baseline, especially for length of history and credit mix. Adding a secured card or a small installment loan quickly supplies the missing information and lets the other factors work in your favor.
• Authorized users - The primary holder's payment history and utilization flow to the authorized user's report. If the primary maintains on‑time payments and low balances, the authorized user can inherit a boost of up to several points; poor habits can drag the score down just the same. Removing the user erases the effect after about 30 days.
• Identity theft - Fraudulent accounts create negative marks such as late payments, high utilization or new hard inquiries. Because payment history dominates, each false late payment can shave dozens of points. Promptly filing a fraud alert, disputing the entries, and obtaining a victim‑identity report are essential to stop further damage and to have the false data removed.

These scenarios illustrate why the standard factor weights still apply, but the data source shifts. When you move to the next section, you'll see how real‑world score swings unfold in practice.

Three typical scenarios illustrate how a FICO score can jump up or down within months.

• Paying off a credit‑card balance that drops utilization from about 45 % to 20 % (the 30 % utilization factor) often lifts the score by roughly 30 - 40 points within a billing cycle, as shown in the utilization section.
• Missing a single payment after years of on‑time history (the 35 % payment‑history factor) can shave 50 - 100 points off the score, even though the lapse may be only 30 days, reflecting the heavy weight of payment history discussed earlier.
• Opening two new revolving accounts in one month (the 10 % new‑credit factor) typically knocks 20 - 30 points off a 750‑point score; after six months, if balances stay low and the average age of credit improves, the score can rebound to its prior level, demonstrating the interplay of new credit and length of history (15 % factor).

Boost your FICO score in 90 days by targeting the weighted factors - payment history (35%), amounts owed (30%), length of history (15%), new credit (10%), and credit mix (10%) - with precise actions.

1. Eliminate missed payments - Pay every bill on time for the next 90 days; set automatic transfers or calendar alerts to avoid slip‑ups. On‑time payments protect the 35% payment‑history slice you learned about earlier.
2. Slash credit utilization - Reduce balances to under 30 % of each limit, ideally below 10 %. If a card shows a $2,500 limit, keep the balance at $250 or less. This directly improves the 30 % utilization factor discussed in the credit‑utilization section.
3. Strategically pay down high‑interest cards - Focus extra cash on the account with the highest rate; lower balances faster, then move to the next. Faster debt reduction boosts both utilization and overall payment‑history perception.
4. Freeze new credit pulls - Avoid applying for loans or cards; each hard inquiry nudges the 10 % new‑credit component down temporarily. If a needed inquiry is unavoidable, limit it to one within the 90‑day window.
5. Add a seasoned authorized user - Request to become an authorized user on a family member's long‑standing, low‑balance card. Their positive history can extend your length‑of‑history (15 %) and mix (10 %) without opening a new account.
6. Negotiate 'pay for delete' on small collections - Contact collectors, offer a paid‑in‑full settlement in exchange for removal from your report. Eliminating a collection restores points across multiple factors, especially payment history.
7. Monitor your report daily - Use a free credit‑monitoring service to spot errors instantly; dispute inaccuracies through the online portals of the three major bureaus. Clean records protect every factor and keep gains from slipping.

Follow these steps consistently; most users see a noticeable lift in their FICO score by the end of the 90‑day period, setting the stage for the advanced strategies covered in the next section.