How To Improve A Bad Credit Rating

Today I’m going to take a brief look at what makes up your credit score. When working with hard money lenders, what your credit was did not typically make much of a difference. In the market today, on the other hand, much has changed, and even in the hard money realm, your individual credit is playing a larger role in lending decisions.

A large number of people are not well informed at all when it comes to the true facts surrounding their credit score and what it consists of. We have made a quick concise overview on credit score factors:

Thirtyfive percent of your credit score comes from payment history. This is the most weighted area of the credit score factors, and the newest information matters the most. The items that make up this category are

• Late payments
• Charge offs
• Tax Liens
• Bankruptcies

30% of your credit score comes from accounts owed. Credit cards, first, second and third mortgages, car loans, lines of credit and installment loans all make a difference in this section.

fifteen percent of your credit score results from how long your credit history is, how long your various credit cards and other loans have been open in other words.

Ten percent comes from recent activity. Getting your credit run falls under this section.

Finally, the last ten percent comes from the kind of credit that you have used.