A credit score is a number that lenders use to estimate how likely you are to repay borrowed money. Most scoring models — including FICO and VantageScore — produce a score between 300 and 850. A higher score signals lower risk to lenders.
The five factors that affect your score:
- Payment history (about 35%) — whether you pay on time. This is the single biggest factor.
- Amounts owed / credit utilization (about 30%) — how much of your available credit you are using. Lower is better.
- Length of credit history (about 15%) — how long your accounts have been open.
- Credit mix (about 10%) — the variety of credit you manage, such as cards and installment loans.
- New credit (about 10%) — recent applications and newly opened accounts.
Why your score matters: it affects whether you are approved for loans and credit cards, the interest rate you are offered, and sometimes things like security deposits.
How to strengthen your score: pay every bill on time, keep card balances well below your limits (under about 30% utilization is a common guideline), keep older accounts open, and apply for new credit only when you need it.
If you are building or rebuilding credit, RMO Credit Builder offers products designed to help you establish a positive history.