How is your credit score calculated?
See how credit score calculations work, from the five FICO factors to VantageScore, and learn why your scores can differ from one lender or bureau to the next.
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Summary
Credit score calculations turn the information in your credit report into a three-digit number, usually between 300 and 850.
A FICO® Score uses five categories: payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%), and credit mix (10%).
VantageScore uses similar factors with different weights. In VantageScore 4.0, payment history is 41% and credit utilization is 20%.
Late payments, bankruptcy, and foreclosures can stay on a credit report for years, though their effect on a score tends to fade over time.
OnePay Credit Score offers free weekly score updates, and the OnePay Builder Card reports payment activity to the three major credit bureaus unless you opt out.
Your credit score isn't a mystery number. It comes from a set of credit score calculations that turn the information in your credit report into a three-digit score.
Lenders use your credit score to estimate credit risk, which is how likely you are to repay what you have borrowed on time, and to get a sense of your creditworthiness.
Lenders often use your credit score to decide whether to approve you and how much interest to charge. Because several credit scoring models exist, the exact math can differ from one score to the next. If you want a primer first, you can read about what credit is and why it matters which unpacks the mechanics behind the most frequently used models.
Where your credit score comes from
Lenders report account details to the credit bureaus, which are Equifax, Experian, and TransUnion. Credit scores are generally based on the information in your credit reports, and credit scoring models then turn that data into a number, most often between 300 and 850.
The two best-known score makers are FICO and VantageScore. A FICO® Score is a three-digit number developed by Fair Isaac Corporation. VantageScore is a scoring model created by the three major credit bureaus. Each model also comes in different versions.
myFICO says its products include a FICO® Score 8 and may include other versions, and a lender may use a different version or another type of score altogether. That's one reason your FICO credit score can look different from a score you see somewhere else.
The five factors in a FICO® Score
A FICO® Score is calculated from five categories of data in your credit report. myFICO lists the general weight of each one:
Payment history (35%): whether you've paid past credit accounts on time.
Amounts owed (30%): how much credit and loan debt you're using.
Length of credit history (15%): how long your credit accounts have been open.
New credit (10%): how often you apply for or open new accounts.
Credit mix (10%): the kinds of accounts you have, such as credit cards and loans.
The percentages above reflect how much each factor matters across all consumers, on average. The importance of each category can shift from person to person, and it can change as your credit behavior and your credit report change. A FICO® Score only looks at the information in your credit report, though lenders may also consider things like your income.
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Payment history: the biggest factor
Payment history carries the most weight in a FICO® Score. It looks at whether you've paid past credit accounts on time, including credit cards, an auto loan or car loan, student loans, personal loans, and mortgage loans. Because FICO weighs this category most, a record of on-time payments matters whether someone is working toward a good credit score or already has excellent credit.
Late or missed payments, bankruptcy, and foreclosures are among the items that can hurt a score. Experian says most negative items stay on a credit report for up to seven years, and a Chapter 7 bankruptcy stays for 10. While a foreclosure stays on your report for seven years from the date of the first missed payment that led to it.
Late payments are generally reported once they're at least 30 days overdue. The effect of these items on a score usually fades over time, even while they remain on the report.
Amounts owed and credit utilization
The amounts owed category looks at how much you owe compared with the credit available to you. myFICO says that using a lot of your available credit may signal that you're overextended. A big piece of this category is your credit utilization ratio, which compares your balances to your credit limits on revolving credit accounts such as credit cards.
To find a utilization ratio, divide a balance by the credit limit and multiply by 100. For example, a $1,500 balance on a card with a $5,000 limit is a 30% ratio. Experian notes that a rate below 30% is generally seen as acceptable and that rates under 10% tend to work best for maximizing a score.
Credit utilization applies to revolving credit, which you can borrow, repay, and borrow again up to a limit. A home equity line of credit is one example. The FTC describes it as a revolving line of credit, similar to a credit card, that's secured by your home. Installment loans, such as an auto loan, student loans, personal loans, or mortgage loans, work differently. They have set payments over a set period instead of a limit you can borrow against again.
Length of credit history
Length of credit history makes up 15% of a FICO® Score. myFICO says it looks at the age of your oldest account, the age of your newest account, and the average age of all your accounts. In general, a longer history is positive for your scores, but it isn't required for a good credit score.
Credit mix
Credit mix makes up 10% of a FICO® Score. It considers the mix of credit cards, retail accounts, installment loans, finance company accounts, and mortgage loans on your report. A home equity line of credit or student loans can also show up there. myFICO says it isn't necessary to have one of each type.
New credit, hard inquiries, and soft inquiries
New credit covers the accounts you've recently opened or applied for. myFICO says opening several accounts in a short time can represent greater risk, especially for people without a long credit history. Applying for credit usually triggers a hard inquiry, and the CFPB says a hard inquiry can impact your credit score.
Soft inquiries are different. They happen when you or someone else checks your credit without a specific credit application, and they don't affect your scores. Checking your own score is one example.
How VantageScore calculates things
VantageScore groups data a little differently. It combines the age of your accounts under depth of credit. VantageScore 4.0 weighs payment history at 41%, depth of credit at 20%, and credit utilization at 20%, and the remaining weight covers factors such as recent credit and balances. VantageScore 4.0 also uses trended data, which looks at patterns in credit behavior over up to two years instead of a single point in time.
Why your scores can differ
It's common to see different numbers from different places. The CFPB says lenders use different scores for different products, many scoring formulas exist, and information can come from different credit reporting companies. Credit card issuers may also report to each bureau at different times, so two reports can show slightly different data on the same day. Score differences matter because a higher score generally makes it easier to qualify for a loan and may come with lower interest rates.
See your score and build credit with OnePay
OnePay Credit Score shows your VantageScore in the OnePay app. OnePay partners with TransUnion to provide free weekly credit score updates, and the app breaks down the factors behind your score. Checking your score in the app doesn't affect it.
One important note is that because this is a VantageScore, it can differ from the FICO® Scores a lender may use.
The OnePay Builder Card is a secured Mastercard® with no security deposit, no credit check, and no monthly fees. Your spending power is tied to your Checking balance, and each purchase moves that amount into a separate lockbox. Unless you opt out, OnePay reports your Builder Card payment history to TransUnion, Experian, and Equifax. Payment history counts the most toward your score; reported on-time payments can help, while missed payments can hurt. Results vary and are not guaranteed.
Frequently Asked Questions
Credit scoring models use the data in your credit report. A FICO® Score weighs payment history at 35%, amounts owed at 30%, length of credit history at 15%, new credit at 10%, and credit mix at 10%. VantageScore uses similar categories with different weights.
Payment history is the biggest factor in a FICO® Score, at 35%. It's also the largest factor in VantageScore 4.0, at 41%.
FICO says a good credit score falls between 670 and 739. Scores from 740 to 799 are very good, and 800 to 850 is exceptional. Each lender sets its own standards, so the score one lender treats as good may differ from another's.
Divide your balance by your credit limit and multiply by 100. For overall utilization, add up the balances and the limits on all your revolving accounts first. Scoring systems can also look at each account on its own.
No. Checking your own score is a soft inquiry, which doesn't affect your credit score. You can learn about ways to check your credit score on the OnePay blog.
Late payments generally stay on a credit report for up to seven years. Experian notes that their impact on a score usually fades over time. Late or missed payments can affect your score, so the details of each account matter.
A Chapter 13 bankruptcy stays on a credit report for seven years from the filing date, and a Chapter 7 bankruptcy stays for 10 years. Its impact on a score can lessen as time passes.
Both use a 300 to 850 range and look at similar factors, but they weigh them differently. For example, payment history is 35% of a FICO® Score and 41% of VantageScore 4.0. VantageScore 4.0 also uses trended data over up to two years.
Lenders may report to some bureaus and not others, or at different times, so each bureau's file can hold slightly different data. A different scoring model or version can also change the number.
A score can change whenever new information reaches the credit bureaus. Many credit card issuers report once a month. OnePay Credit Score updates weekly. If you're working on building credit, it's normal for changes to take time.