Your credit is an important aspect of your financial profile when applying for a loan or even seeking to obtain employment. It's a good idea to learn what factors affect this score and how.
Identification
Your credit score is a three digit number. The score is generated by a numerical algorithm and is based upon the information contained in your credit report. A FICO credit score ranges from a low of 300 to a high of 800. The number is not static, but is ever-changing depending upon the changes that occur within your credit report.
Significance
According to FICO, 30 percent of your score reflects how well you pay your bills. A judgment occurs when a creditor takes you to court and receives a ruling against you for a specific sum of money. It indicates that you did not honor your financial obligations and is displayed on your credit report as a public record.
Effects
A judgment will drop your credit score once added to your credit file. The severity of the drop depends on the other information contained within your credit report. According to myFICO, judgments have a negative affect on your credit score and will remain on the report for seven years, whether you later pay it or not. The impact on your score lessens as time passes, however.
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