What affects my credit score?

One late payment can chop up to 100 points off your score. What happens if you pay all of your bills late over a month’s time? Expect to see a loss of up to 150 points. Source: Your Credit Score by Liz Pulliam Weston

Knowing what financial behavior affects your score will help you manage your money and credit. And the better you manage your money and credit, the closer you’ll be to qualifying for a Habit for Humanity home.

The table below lists five financial behaviors that affect your score. The percentage next to each item represents how much that behavior affects credit score. The higher the number, the more that behavior affects your score.

For example, the single most important thing you can do is pay your bills on time. That will improve your score the fastest, for your payment history makes up 35 percent of your score. Paying down your credit balances is the second fastest way to improve your score. The amount of your credit balances makes up 30 percent of your score.

Going on down the list, the other things that will improve your score include:
•	A longer credit history
•	Asking only for the credit you need, and waiting at least six months before you ask for more credit
•	Using several types of credit; using installment loans will improve your score more than using credit cards

How Financial Behaviors Affect Your Credit Score
Financial Behavior	How Heavily it Affects Your Score
How you pay your bills: • On time: helps your score • Late: damages your score	35%
How much money you’ve borrowed (your credit balances): • Low credit card and loan balances: helps your score • High balances: damages your score	30%
How long have you been using credit: • Many years: helps your score • Just a couple: damages your score	15%
How often you request credit: • Once or twice a year: helps your score • Many times a year: damages your score	10%
The type of credit you use: • A combination of loans and credit cards: helps your score • Just credit cards: this really doesn’t affect your score, but using a combination of credit helps your score	10%