Credit Score (FICO)

A credit score compresses your borrowing history into a number — most commonly the FICO score’s 300–850 scale — that lenders use to price risk. Scores in the mid-700s and above earn the best advertised rates; each tier below pays progressively more for the same loan.

The FICO recipe is public in outline: payment history (~35%) — late payments hurt most; amounts owed (~30%) — especially utilization, your card balances as a share of limits; length of credit history (~15%); new credit inquiries (~10%); and credit mix (~10%). Income, notably, is not a factor — scores measure repayment behavior, not capacity (that’s what DTI covers).

What moves it fastest: paying every bill on time (automate minimums), and pushing card utilization down — below 30% helps, below 10% helps more. Balances reported at statement time drive utilization, so paying before the statement date lowers the number lenders see.

The stakes are concrete: on a $300,000 30-year mortgage, the rate difference between a 640 and a 760 score is commonly half a point or more — tens of thousands of dollars of interest. You’re entitled to free weekly reports at AnnualCreditReport.com; check them for errors before any major application.