How credit scores are calculated

A three-digit number affects your rent applications, loan rates and sometimes your phone contract. Here’s what goes into it, and what actually moves it.

6 minute read · Written for the US · Last reviewed November 11, 2026

Report vs. score

Your credit report is a record of your borrowing history, kept by three companies called credit bureaus: Equifax, Experian and TransUnion. Your credit score is a number calculated from that report. There are many different scores, but the most widely used is the FICO Score, which runs from 300 to 850.

You can see your reports for free. Scores are sometimes free too, through your bank or card issuer, but the report is what really matters, because that’s what the score is calculated from.

What goes into a FICO Score

FICO publishes roughly how much each category counts:

Payment history (about 35%). Did you pay on time? Late payments, collections and bankruptcies hurt the most.
Amounts owed (about 30%). Mostly your credit utilization: how much of your available credit card limit you’re using.
Length of credit history (about 15%). How long your accounts have been open, on average and in total.
New credit (about 10%). Recently opened accounts and recent applications.
Credit mix (about 10%). Whether you’ve handled different kinds of credit, such as cards and installment loans.

What actually moves it

Paying on time, every time

This is the single biggest factor. A payment that’s 30 or more days late can stay on your report for years. Autopay for the minimum payment protects you from forgetting.

Lowering utilization

If you have a $1,000 limit and a $600 balance, your utilization is 60%. Lower is better. Unlike late payments, utilization has no memory: pay the balance down and your score can recover within a month or two.

Leaving old accounts open

Closing your oldest card can shorten your history and lower your total available credit. If a card has no annual fee, it’s often better to keep it open and use it occasionally.

Things that don’t hurt your score

Checking your own credit. This is a “soft inquiry” and has no effect.
Your income, job or savings. These aren’t part of your credit report.
Pre-approved offers. These come from soft inquiries made by lenders.

Applying for new credit causes a “hard inquiry,” which can lower your score slightly for a while. When you shop for a mortgage or car loan, multiple applications within a short window are usually counted as one.

Do this today

Get your free credit reports from AnnualCreditReport.com, the official site for all three bureaus.
Check each report for accounts you don’t recognize and for wrong late payments.
Set up autopay for at least the minimum payment on every card and loan.
Work out your credit utilization (balances ÷ limits) and aim to bring it down.

Sources

This guide is general information, not financial advice. Scoring models are updated over time and different lenders use different versions.