Your credit score is a three-digit number that lenders use to decide whether to lend you money and what interest rate to charge
A credit score ranges from 300 to 850. The higher your score, the lower the risk you appear to lenders. Banks, credit card companies, landlords, and sometimes employers use this number to make decisions about you — whether to approve a loan, what terms to offer, or whether to rent to you. Your score changes over time based on your payment history, how much debt you carry, and other factors in your credit report.
You have not one credit score but three, because three companies — Equifax, Experian, and TransUnion — each maintain their own credit report about you and calculate their own score. These scores often differ slightly because the companies may have different information. Lenders may check one, two, or all three. You can see your own scores for free once a year through AnnualCreditReport.com, which is the official site run by the three bureaus.
Key Takeaways
- Your credit score is a number between 300 and 850 that lenders use to decide whether to lend to you and at what interest rate.
- Three credit bureaus — Equifax, Experian, and TransUnion — each calculate your score separately, and the numbers may differ.
- Your score is built from five main factors: payment history (35%), amounts owed (30%), length of credit history (15%), credit mix (10%), and new credit inquiries (10%).
- You can see your credit report and score free once per year at AnnualCreditReport.com, and some credit card companies and banks show your score for free in your account.
- A score above 670 is generally considered good; above 740 is very good; above 800 is excellent.
The five factors that make up your score
Payment history is the largest piece — 35% of your score. This means whether you pay your bills on time. A single late payment can drop your score, and the later the payment, the bigger the damage. A payment 30 days late hurts less than one 90 days late. Payments that go to collections or result in a judgment damage your score for years.
Amounts owed makes up 30% of your score. This is not just the total amount you owe, but how much you owe compared to your credit limits — called your credit utilization ratio. If you have a credit card with a $5,000 limit and you carry a $4,500 balance, your utilization is 90%, which hurts your score. Utilization below 30% is generally better for your score. This applies to each card separately and to your total across all cards.
Length of credit history is 15% of your score. This is how long you have had credit accounts open. Older accounts help your score more than newer ones. Closing old accounts can hurt your score because it shortens your average account age. This is why keeping an old credit card open, even if you do not use it, can help.
Credit mix is 10% of your score. Lenders like to see that you can handle different types of credit — credit cards, car loans, mortgages, and so on. Having only credit cards, or only one type of debt, is less favorable than having a mix.
New credit inquiries make up the final 10%. When you apply for credit, the lender checks your report, which is called a hard inquiry. Multiple hard inquiries in a short time can lower your score slightly. Checking your own score is a soft inquiry and does not affect it.
What different score ranges mean
Credit scores fall into ranges that lenders use to make decisions. The ranges are not official — different lenders may use slightly different cutoffs — but these are the most common:
| Score Range | What It Means |
|---|---|
| 300–579 | Poor. Lenders see high risk. You may not be approved for credit, or approval may come with very high interest rates. |
| 580–669 | Fair. You may be approved, but at higher interest rates than someone with a better score. |
| 670–739 | Good. You are likely to be approved at reasonable interest rates. |
| 740–799 | Very good. You are likely to be approved at favorable interest rates. |
| 800–850 | Excellent. You are very likely to be approved at the best available interest rates. |
How your credit report connects to your score
Your credit score is calculated from information in your credit report. The report lists every credit account you have or had, payment history for each one, any late payments or collections, public records like judgments or bankruptcies, and inquiries from lenders who checked your report.
Errors on your credit report can lower your score unfairly. You have the right to dispute any error with the credit bureau. The bureau must investigate within 30 days and remove information that is inaccurate or cannot be verified. You can file a dispute online, by mail, or by phone with Equifax, Experian, or TransUnion.
Negative information stays on your report for a set time: late payments for seven years, collections for seven years, bankruptcy for seven to ten years depending on the type. After that time, the information falls off and no longer affects your score.
Where to see your own score
You can see your credit report free once per year at AnnualCreditReport.com. This site shows you the report itself, not the score. To see the actual score, you have a few options.
Many credit card companies and banks show your score for free in your online account. Chase, Capital One, Discover, and others offer this. The score they show may be from one of the three bureaus, and it may not be the exact score a lender sees, but it gives you a sense of where you stand.
You can also buy your score directly from the credit bureaus or from sites like Credit Karma, which offers free scores. Keep in mind that free scores from third-party sites may use a different scoring model than the one a lender uses, so the number may not match exactly.
What does not affect your credit score
Your score does not include income, employment history, or savings. A lender may ask about these things, but they do not go into your credit score. Your age, race, gender, marital status, and location also do not affect your score — by law, credit scoring cannot use these factors.
Checking your own credit report or score does not hurt it. Soft inquiries — when you check your own report or when a company checks it for marketing purposes — do not lower your score. Only hard inquiries from lenders you have applied to count against you.
Frequently Asked Questions
How long does it take for a late payment to stop hurting my score?
A late payment stops affecting your score after seven years from the date it was reported. However, the damage is worst in the first year or two. After three years, the impact lessens significantly, though it remains on your report until the seven-year mark.
Can I have different scores from the three credit bureaus?
Yes. Each bureau may have different information about you, so each calculates a different score. One bureau might have a late payment that another does not know about yet. The differences are usually small, but they can be meaningful if you are close to a lending cutoff.
Does paying off debt immediately raise my score?
Paying off debt helps your score, but not instantly. Your score updates when the credit bureau receives new information from your lender, which usually happens monthly. You may see an improvement within 30 to 45 days of paying down a balance.
What is a good credit score for renting an apartment?
Landlords have different standards, but many prefer a score of 650 or higher. Some will rent to people with lower scores, especially if you have other strengths like a co-signer or proof of income. Ask the landlord what their requirement is before you apply.
If I close a credit card, will my score go down?
Closing a card can lower your score because it reduces your total available credit, which raises your utilization ratio on remaining cards. It also shortens your average account age. If you want to close a card, pay down the balance first to lower utilization on other cards.