What Factors Affect Credit?

Credit is important, but what factors affect credit? There are a lot of myths about how credit scores work and what affects credit in general. Let’s review how your credit works and what will hurt you or help you.

What Will Affect Credit?

To have good credit, you need to show a rich history of responsibly using credit. Lenders want you to be a seasoned borrower who always pays on time. For the basics on what credit is, what it isn't, and how it works, see:

• What is Credit?
• How Credit Scores Work

These pages mostly cover mainstream credit scoring and reporting (such as the FICO score, the most commonly used score for major loans like home purchases). However, there are alternative systems out there and other factors will affect credit differently under those systems.

• How the FICO Credit Score Works

Be aware that credit scoring models are complex and top-secret. Therefore, it’s impossible to know exactly which factors affect credit.

Myths and Facts About What Affects Credit

Here are some of the most frequently asked questions about what affects credit and credit scores:

• Does Marriage Affect Credit?
• Do Bounced Checks Affect Credit?
• Do Utility Payments Affect Credit?
• Does Foreclosure Affect Credit?
• Does Income Affect Credit?
• Do Purchase Transactions Affect Credit?
• Do New Loans Affect Credit?
• Does Co-Signing Affect Credit?