Your FICO score, named after Fair, Isaac and Company (the business that is known for developing the most popular credit scoring equations), is a summary of your credit history. This summary includes reports from the three major reporting bureaus: Equifax, TransUnion, and Experian. Your FICO score indicates to potential lenders how much of a risk you pose, and includes things such as available credit, late payment reports, and any outstanding and unresolved balances.

Scores can range from 300 to 850 points. The higher your score is, the less risk you pose in the eyes of creditors. On average, if your score is lower than 620 you will be paying a premium in interest rates, if you can secure loans at all. The lowest interest rates are usually reserved for individuals who score higher than 760 points.

The 5 Categories of Your FICO Score

In order to monitor your FICO score it is important to understand the 5 basic categories that contribute to the overall credit history summary.

Payment History = 35%

Late payments on those credit cards and loans can have the biggest impact on your FICO score (not including bankruptcy or things such as liens). Your score in this category will also be impacted by how often and how recently you are late on your payments.

Outstanding Balances = 30%

If you are maxed out on your credit cards and have a long history of not being able to pay off your cards in full, you are going to be lowering your outstanding balances score. These types of activities demonstrate that you are financially strained and a high loan risk.

Length of Credit History = 15%

Potential lenders want to see a long, solid history of repayment and positive credit in this category. The length of time you’ve have credit accounts in good standing will influence the points you receive. This is why you might hear people say that it is a good idea to have credit cards even if you don’t use them as it establishes your credit history.

New Credit = 10%

If you have just applied for and opened several new credit accounts, you will be considered a much higher risk, especially if your overall credit history is relatively short.

Types of Credit = 10%

This portion of your score is a summary of the different types of accounts you have – credit cards, auto loans, mortgage loans, etc.

Options for Monitoring My FICO Score

Now that you understand a bit more about what makes up your overall FICO score you can proactively do two things: check your actual FICO score and work to improve your credit rating. There are several agencies that offer reports on your FICO score. Two popular services include myFICO and CreditCheck Total. The services from myFICO (typically an inexpensive subscription) includes two free score reports each year with your current FICO score. You can also use myFICO to request notification any time there is a change to your report (note that myFICO only files reports based on the Equifax report). Services such as CreditCheck Total can be more expensive than myFICO, but they can also be more comprehensive as they draw from all three credit reporting bureaus.

If you just need a free copy of your credit report, you can always use the completely free annual service at the website that allows you to request a free credit file disclosure, commonly called a credit report, once every 12 months from each of the nationwide consumer credit reporting companies: Equifax, Experian and TransUnion. is the official site to help consumers to obtain their free credit report, but does not provide you with FICO monitoring services.

Moe Bedard
My name is Maurice "Moe" Bedard. I am the founder of America's #1 Mortgage Forum, My online work has been featured in the New York Times, LA Times, Fox Business, and many other media publications.