Experian Score Factors

Experian, along with two other credit reporting agencies, TransUnion and Equifax, developed the VantageScore as an alternative to the FICO score that is calculated by the Fair Isaac Corp. The VantageScore is supposed to be a better predictor of risk for individuals with a short credit history. It uses your payment history, your utilization of credit, balances you owe, your depth of credit, any recent applications for credit and your available credit based on your credit report to determine your credit score.

Payment History

Your payment history accounts for 32 percent of your VantageScore. This portion examines how well you have repaid your credit obligations--whether you made your payments on time and how often payments were more than 30 days late. It also includes and defaults or bankruptcies on your credit report. Recent information is weighted more heavily that past information, so a late payment three years ago will hurt your score less than a missed payment last month.

Utilization of Credit

How much of your available credit you use accounts for 23 percent of your credit score. The amount of credit you use is determined by dividing how much you owe by the total amount of your credit limits. For example, if you owe $400 on your credit cards and the credit limits for all your cards combine to $4,000, you are using 10 percent of your available credit.

Balances

Your current balances account for 15 percent of the credit score. The more money you owe, the greater credit risk you appear to be to lenders. This section also reduces your score for any balances where payments are not current.

Depth of Credit

The depth of your credit composes 13 percent of your total score. This section includes how long you have had credit and the types of credit you have used. Scores are higher for individuals who have used different types of credit--mortgages, installment payments and credit cards--than for people who have used only one type of credit.

Requests for New Credit

Requests for new credit account for 10 percent of your VantageScore. Fewer applications you in your recent history are better for your score. Lenders fear that individuals who apply for a significant amount of new credit are a greater risk for defaulting on those loans.

Available Credit

The amount of credit you have remaining on your accounts composes 7 percent of your score. If you have more credit available to use it shows that you are good at managing your credit, which makes you a more trustworthy borrower. If you have high balances, you are seen as a higher risk because lenders fear that you cannot manage your available credit.