Factors That Influence Your Credit Score

Payment History - 35%

If you want to improve your score, this category can have the greatest effect. However, previous problems such as missed or late payments are
more difficult to correct.

  1. Pay your bills on time
  2. If you have missed payments, get current and stay current
  3. Be aware that paying off a collection account will not remove it from your credit report

Amounts Owed/Capacity - 30%

This category can be easier to clean up than payment history, but requires financial discipline and understanding the tips below.

  1. Keep balances low on credit cards and other “revolving credit”
  2. Pay off debt rather than moving it around
  3. Don’t close unused credit cards as a short-term strategy to raise your score
  4. Don’t open a number of new credit cards that you don’t need just to increase your available credit

Length of Credit History - 15%

  1. If you have been managing credit for a short time, don’t open a lot of new accounts too rapidly
  2. Never close out your oldest revolving trade line

New Credit - 10%

  1. Do your rate shopping for a given loan within a 14 day time frame
  2. Re-establish your credit history if you have had problems
  3. It’s okay to request and check your own credit report

Type of Credit - 10%

  1. Apply for and open new credit accounts only as needed
  2. Have credit cards – but manage them responsibly
  3. Moving revolving debt to installment could increase score
  4. Borrowing from finance companies can have a negative impact on your score
  5. Note that closing an account doesn’t make it go away

Contact a Branch Partner today to start reviewing your credit score.

Prospera Credit Union is not a certified credit counselor.