What is the most important factor that FICO uses to determine your credit score?
new credit
amount owed
payment history
credit mixed
payment history
The most important factor that FICO (Fair Isaac Corporation) uses to determine your credit score is your payment history. A person's payment history makes up about 35% of their FICO score. FICO looks at whether you have paid your credit accounts on time, if you have any late payments, collections, or bankruptcies, and how long it has been since these negative events occurred. A strong payment history, with consistent on-time payments, reflects positively on your creditworthiness and can help increase your credit score.
To determine your credit score, FICO considers various other factors as well, including the amount owed (which contributes about 30% to your score), the length of your credit history (15% of your score), credit mix (10% of your score), and new credit (10% of your score).
To improve your payment history and overall credit score, it is important to make payments on time, avoid late payments or defaults, and manage your debts responsibly. Regularly monitoring your credit report and keeping a low credit utilization ratio can also help maintain a good payment history and improve your credit score over time.