Page 12 - increase your credit score

1. Payment History: 35% of Your Score

The most critical factor contributing to your score is your payment history. Lenders want
to know you make your payments on time. If you don’t make your payments on time,

credit bureaus will find out.

When those late payments are run through a scoring model, your score will go down.
Scoring models are most concerned about the following five delinquencies:

• 30-day delinquencies

• 60-day delinquencies
• 90-day delinquencies

• Charge-offs
• Collections

The first trio of “delinquencies” are actually names for payments that are 30-, 60-, or 90-

days late. Your typical late payment on a credit card won’t hurt you until you are at least
30 days late.

Once your account is more than 90 days late, you go into default. After six months of non-

payment, the lender can do a “charge-off.”

A charge-off is the lender’s way of saying, “We don’t think this person will ever pay their
debt.” At this point, they usually sell your debt to a collections agency, a move that also

goes on your credit report.

All five of these factors can stay on your credit score for up to seven years, even if you pay
the late balance or collections company. However, the effect on your score will diminish

as time goes on.

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