Sure, the FICO credit score is the most commonly used across the board, but it’s not the only credit score in town. Credit Scoreīelieve it or not, the FICO score is actually just one type of credit score-it’s not the only kind of credit score out there. What they really care about is how good you are at juggling debt. They aren’t all that interested in how well you handle money. Yeah, they don’t pay any attention to those things. What doesn’t a credit score take into consideration? Oh, you know, just the really important things, like how much money you have in savings and what your net worth is. Have you opened up a bunch of new credit cards recently (or tried to)? They really look into everything Here, credit bureaus are looking into your recent activity. Credit cards would fall into the revolving account category. Installment accounts include things like your mortgage, a car loan or personal loans. And usually, those fall into two categories: installment accounts and revolving accounts. The credit bureaus want to know what kinds of credit you’re juggling. This category factors in the average age of all of your credit accounts (including the newest and the oldest). If this gives you a head tilt, you’re in good company. But they also don’t like it when you’re not using enough. Turns out, creditors don’t want you borrowing up to your credit limit (at least we have that in common). Have you missed payments? Are you in good standing with your creditors? Have you filed for bankruptcy?Īmounts owed (or credit usage) just looks at the percentage of debt you have in comparison to your credit limit. They take a detailed look at how you’ve handled your debt over the years. Your payment history is exactly as it sounds. This makes up the biggest chunk of your credit score, coming in at a whopping 35%. But here are the factors we do know they use to figure out your credit score: 1 In other words, no one outside the company really knows exactly how they calculate the scores. The folks at FICO love to keep their cards close to the chest on this one. All it really says is how good you’ve been at making payments to banks and lenders over and over again. In reality, a FICO score doesn’t measure how good you are with money, how wealthy you are, or how successful you are. In reality, the FICO score didn’t even become a thing until 1989-and that means it could be younger than you! Kind of makes you think twice about how much people rely on this thing, doesn’t it? But that’s just what the powers that be at FICO want you to think. In today’s world, most people probably think the FICO score is as old as time itself. Founded back in 1956 by Bill Fair and Earl Isaac, FICO has become a powerhouse of credit reporting over the years. So, who do we have to thank for the “almighty” FICO score? That would be the company that used to be called the Fair Isaac Corporation.