Your Credit Score: What it means
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Before they decide on the terms of your loan, lenders want to find out two things about you: your ability to repay the loan, and if you will pay it back. To assess your ability to repay, they look at your income and debt ratio. To assess how willing you are to repay, they use your credit score.
Fair Isaac and Company calculated the first FICO score to help lenders assess creditworthiness. You can learn more on FICO here.
Your credit score comes from your repayment history. They never take into account your income, savings, amount of down payment, or factors like gender, ethnicity, national origin or marital status. These scores were invented specifically for this reason. "Profiling" was as bad a word when these scores were invented as it is today. Credit scoring was envisioned as a way to consider only what was relevant to a borrower's likelihood to repay a loan.
Deliquencies, payment behavior, debt level, length of credit history, types of credit and number of inquiries are all calculated into credit scoring. Your score is calculated from both the good and the bad in your credit history. Late payments will lower your score, but consistently making future payments on time will raise your score.
To get a credit score, you must have an active credit account with a payment history of at least six months. This history ensures that there is sufficient information in your credit to assign a score. If you don't meet the minimum criteria for getting a score, you might need to establish your credit history prior to applying for a mortgage.