Rules in Establishing Credit Scores

You must have a minimum of six months of credit history in order to establish a credit score. Your credit history is compiled from the reports your creditors send to the three major credit reporting agencies--Equifax, TransUnion and Experian---about how you handle credit. You can establish a credit history with a bank, department store or gas station credit card, or with a bank, credit union, car or student loan.

Payment History

You must have a payment history, so it is not enough just to have a credit card: you must use it and make payments on the outstanding balance. Your payment history includes whether you make payments on your credit card or loan on time, the number of late payments, how long past due your accounts are, how much is past due and how many accounts have been paid as agreed. Late payments will reduce your score. Your payment history accounts for roughly 35 percent of your credit score.

Amounts Owed

The amounts you owe on your accounts and the number of accounts you have with balances are counted in your credit score. Using or owing a large proportion of your available credit can decrease your score. Amounts owed account for about 30 percent of your credit score.

Length of Credit History

The length of your credit history influences your credit score. A longer history helps your score more than a short one. Length of credit history accounts for around 15 percent of the overall score.

New Credit

The number of new accounts and the number of recent inquiries from potential creditors affects your credit score. Many new accounts and credit inquiries can lower your score but some inquiries do not affect your score: for example, inquiries that lenders make in order to review your account with them. This factor accounts for roughly 10 percent of the score.

Types of Credit

Ten percent of your overall credit score depends on the types of accounts you have (mortgage, lines of credit, car loan, credit card, consumer finance).

Not Considered

Your age, sex, salary, occupation, race, religion, national origin, marital status, employment history and place of residence do not affect your credit score.