How Your Credit Score is Calculated
You should find out your credit score early-on so that if it needs to be brought up you have time to raise it. Your credit score plays an important part in the home buying process and in determining the interest rate that a lender offers.
How are credit scores calculated?
Credit scores are generated by plugging the data from your credit report into software that analyzes it and cranks out a number. The three major credit reporting agencies don't necessarily use the same scoring software, so don't be surprised if you discover that the credit scores they generate for you are different.
Which parts of a credit history are most important?
The pie chart above right shows a breakdown of the approximate value that each aspect of your credit report adds to a credit score calculation. Use these percentages as a guide:
35% - Your Payment History
30% - Amounts You Owe
15% - Length of Your Credit History
10% - Types of Credit Used
10% - New Credit