How Does Payment History Affect Credit ?

Credit payment history determines 35% of a FICO Score

The first thing any lender wants to know is something about your credit history. Namely, whether your credit payments have been made on time. This is one of the most important factors in a FICO® Score.

A few late payments are not an automatic "score-killer." An overall good credit history can outweigh one or two instances of late credit card payments.

However, having no late payments in your credit report doesn't mean you'll get a "perfect score." Your payment history is just one piece of information used in calculating your FICO Scores

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Types of accounts considered for credit payment history

Account types considered for credit history could include:

  • Credit cards (Visa, MasterCard, American Express, Discover, etc.)

  • Retail accounts (credit from stores where you shop, like department store credit cards)

  • Installment loans (loans where you make regular payments, like car loans)

  • Finance company accounts

  • Mortgage loans

Public record and collection items

These types of events are considered quite serious, although older items and items with small amounts will count less than recent items or those with larger amounts.

Negative factors include:

  • Bankruptcies - will stay on your credit report for 7-10 years, depending on the type

  • Lawsuits

  • Wage attachments

Details on late or missed payments ("delinquencies") and public record and collection items

FICO® Scores consider:

  • How late they were

  • How much was owed

  • How recently they occurred

  • How many there are

How many accounts show no late payment

A good track record on most of your credit accounts will increase your FICO® Scores.

 

EXAMPLE 1

EXAMPLE 2

 

STEP TWO: If you have not done so, please schedule a call with one of our representatives for further questions.