Your credit score is the secret number behind everything in your life. How much you pay for insurance, your car, rent and mortgage payments, utilities, and even whether you get a job or not, are ALL based on your credit score.

This article is designed to help you understand each individual component of your credit score.

Your PAYMENT HISTORY is the main aspect of your credit score accounting for 35%. This part of your score calculation is based on your total payment history with your creditors. Monthly late payments, collections, and all other adverse information on your credit report have the most significant effect. The more positive accounts you have and the less adverse accounts, the higher your credit scores.

Your PERCENTAGE of HIGH CREDIT USED is the second largest factor included in the makeup of your credit score accounting for a total of 30% of your total score. This aspect of your score is based on the amount you owe on your individual accounts relative to your high credit limits on those accounts. You will be scored higher if you owe 30% or less of the high credit limit AND, if you are carrying HIGH credit card balances you can actually hurt your credit scores almost as much as paying the account late every month.

Your time in the credit bureau or LENGTH of CREDIT HISTORY accounts for 15% of your credit score. The longer you have had credit accounts for, the higher your credit score will be. As you have more accounts throughout your life time and your credit history grows, your credit scores will naturally increase due to this factor.

How fast you ACCUMULATE NEW DEBT accounts for 10% of your total credit score. This aspect of your credit score is composed of how much new debt you are applying for. It considers how many requests you have for new credit within a 12 month time period. If you have a lot of inquiries in a short period of time, your scores will be impacted.

A total of 10% of your credit score takes into account the “mix” of credit items you have on your report. This part of your credit score is affected by what kinds of accounts you have and how many of each. The bureaus will score you higher if you have an open mortgage, 3 credit cards, 1 auto loan, and a small amount of other open accounts. Any, “unhealthy” account mixes lower your scores such as having too many open mortgages or credit cards.

To obtain your highest credit score make sure you pay your accounts on time, do not keep high balances in relation to your limits on your open accounts, keep a very healthy mix of credit accounts open, and do not apply for too many new credit items in a short period of time.

If you follow the steps in this brief article you will be on your way to an excellent credit score in no time at all.

Ty Crandall is an international authority and expert on credit scoring and credit law. He has over 12 years experience in the financial and credit sectors and is currently the CEO of Elite Credit Incorporated.