From the course: Financial Adulting
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How a credit score works
From the course: Financial Adulting
How a credit score works
- Okay, so bumping up your credit score is obviously super important, especially if you're in those lower ranges, so let's talk about how you can really bump up that score. So first, you need to understand it. So here's what makes up a credit score. Payment history or past delinquency is 35% of the score. In other words, the past is a really good indicator of the future. So if you missed some payments, you defaulted on some loans, that's really going to hurt this part of your credit score. Another 30% is how you're using your credit. Are you abusing it by maxing out your credit cards every month? Lenders get really nervous when you look credit hungry. The age of your credit file is 15%, and this one's really simple. The longer your history, the more trustworthy it is, good or bad. If you're young and you just got your first credit card two years ago, your credit score might not be as good because they've only seen how…
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