Payment history: This refers to how often you have a late payment and is the most important factor, accounting for 35% of your score.
Credit utilization: This takes into consideration how much of your available credit you’re using. Your credit utilization ratio should be less than 30%, which means if you have a $10,000 credit limit, you’re only carrying a balance of $3,000 or less.
Average age of credit accounts: The older your credit accounts are, the better. This shows a long-term history of responsible financial management. More than 10 years is considered excellent.
Account types: A few revolving accounts such as credit cards as well as installment accounts such as car and home loans show lenders you’re responsible in managing multiple types of debt.
Inquiries: When you apply for credit, lenders typically do a hard pull on your credit, which results in an inquiry on your credit report. The more inquiries you have, the lower your score because lenders get nervous when they see someone applying for multiple lines of credit at once.
