Your Credit Score

Today I’m going to take a brief look at what makes up your credit score. When dealing with hard money lenders, your credit score did not usually make much of a difference. In the market today, on the other hand, a lot of things have changed, and even in the hard money lending environment, your personal credit is playing a bigger role in lending decisions.

A lot of people are in the dark when it comes to the factors that determine their credit score. Here is a basic breakdown on credit score factors:

35% of your credit score comes from the history of your payments. This is the biggest of your credit score, and the most recent payment history carries the most weight. The items that fall under this general category include

  • Collections
  • Bankruptcies
  • Judgements
  • Late payments


30% of your credit score relates to your accounts owed. Credit cards, first, second and third mortgages, car loans, lines of credit and installment loans all factor into this part of your credit score.

15% of your credit score results from the length of credit history, how long your revolving debt and credit card accounts have been open in other words.

10% comes from recent activity. Getting your credit run falls under this section.

Finally, the last of your score comes from the kind of credit you use.
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