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Credit Score Fundamentals

Your credit score is like a grade that summarizes your reputation as a borrower.

There are several types of credit scores, but the FICO® score is the most common. Scores range from 300 to 850 – and the higher the better. Generally, a score above 670 is considered to be good and a score below 580 may indicate problems. Your credit score can change over time, and your number today may be different in six months or a year, depending on the information in your credit report and how you manage the components that determine your score.

Five Components of a FICO® Credit Score

Five components of a credit report

  • Payment history (35%)

    Shows how you’ve paid your accounts over the length of your credit. The key here is to pay your bills on time and don’t miss payments.

  • Amounts owed (30%)

    Includes the total amount you owe including a breakdown by account. It also includes the available credit on revolving accounts such as credit cards along with the balance owed on loans compared to the original amount.

  • Length of credit history (15%)

    Shows how long your credit accounts have been open. If you’re just starting out, potential lenders do not have a baseline to determine your credit worthiness. Focus on practicing good habits over time.

  • Credit mix (10%)

    Types of credit accounts you have, including credit cards, auto loans, mortgages, student loans, etc. It is helpful to show good credit habits with different types of credit.

  • New credit (10%)

    When you apply for new credit, inquiries impact your FICO® score for 12 months. Adding multiple credit accounts over a short period of time can have a negative impact.

Financial Counseling

Personal Financial Counselor

Financial counselors are available on most military installations to help Service members with questions about credit reports and credit scores.

Find a Personal Financial Counselor on your installation