How a credit score is built

A FICO Score is a three-digit rank from a credit file. FICO publishes rough weights for versions many lenders use: payment history about 35 percent, amounts owed about 30 percent, length of credit history about 15 percent, new credit about 10 percent, and credit mix about 10 percent. Those are shares of the model, not sliders. Two people with the same utilization can score differently because the rest of the file is not the same.

“Amounts owed” includes revolving utilization. It is not a rule that utilization must stay under 30 percent. The 30 in the weight chart and the 30 in that folk rule are different numbers. Payment history is the largest published weight. The model still consumes the balance that was reported, often the statement closing balance rather than the balance on the due date.

FICO sells more than one score. FICO Score 8 is common on reports sold to consumers. Lenders may buy a different version or an industry option for auto or bankcard decisions. A banking-app number may be a FICO Score, a VantageScore, or an internal rank. Those scales are not interchangeable.

The Fair Credit Reporting Act governs the file the model reads, including disputes and how long most negative information may be reported. It does not publish the scoring equation. This overview will not invent a point value for paying a card down, opening an account, or filing a dispute.