How Often are FICO Scores Updated?

Your credit score, otherwise known as your FICO (Fair Isaac Corporation) score, is what employers and lenders use to determine your creditworthiness. This number changes frequently in response to your changing borrowing habits and your credit history. If you are working to improve your credit, it is important to know how and when your FICO score changes. To understand how FICO updates, it is best to first ascertain how your FICO score is calculated.

Credit Reporting

Your FICO score is calculated from information that is contained on your credit report. Also known as a credit history, this report is compiled separately by the three major credit reporting agencies--Experian, Equifax and TransUnion. Lenders, banks, credit card companies, utilities companies and other creditors report information about your accounts to these credit reporting agencies.

FICO Scores

To calculate your FICO score, several different factors are considered. Though the exact formula for determining your score is proprietary information, there are five main categories that FICO uses. According to FICO's website, these categories are payment history, amounts owed, length of credit history, new credit and types of credit used.

Weighting

Each of these categories is assigned a different value when calculating your FICO score. For example, payment history accounts for 35 percent of your score while types of credit use accounts for 10 percent. Because of this, a delinquent $300 payment will have a much greater effect on your FICO score than only having one type of loan (i.e. revolving credit, installment loan or secured loan) in your credit history. The remaining weights are: amounts owed 30 percent, length of credit history 15 percent and new credit 10 percent.

Calculating FICO

Your score is calculated each time a creditor or another party pulls your credit history (called an inquiry). This is because the score is calculated from items that are on your report. Each time your credit report is requested, the software automatically runs the figures from your most recent credit history information and gives an up-to-date FICO score.

Adverse Public Records

Federal and state law dictates how long certain adverse public records remain on your credit report. These items, such as judgments, items sent to collections, outstanding tax liens and bankruptcies, are part of the payment history category. Typically, these items remain on your credit report for seven to 10 years, though it will vary depending on type of record and state. Once these items no longer appear on your report, they will no longer be factored into your FICO score.