People always ask, how much will a late payment affect my credit score? 100 points? 150? What affect will high utilization have on my credit score? The answer to all of these questions is that it depends.

The Fico scoring model is built to be able to match your credit file with the credit file of millions of other consumers, and compare you with a group of consumers that have similar factors on their report like you. For example, if you have 10 open accounts with the oldest account being 10 years old and you had 3 late payments two years ago, plus you have one charge off account from four years ago. Fico will match you up with a group of people that have similar factors on their report and see statistically how much percent of these people ended up defaulting on a loan. Your score will be calculated based on these percentages.

All these groups which Fico pre-grouped in their scoring model are called scorecards. Depending in which scorecard a consumer is, that’s how much of an affect a late payment will have on his credit score. For example, if you don’t have any previous late on your report and you have credit history for ten years, a first late payment will have a smaller affect on your credit score (but will still be big) then someone who has a history of making late payments.

The same will be also true about positive. Your credit score may go up a lot once your credit cards reach 1 year old or after you opened your 3rd credit card. That’s because the 12th month or the third credit card brought you in to be in a new scorecard and your score is now being calculated using the new scorecard model.

How to Change Myself into a New Scorecard

The Fico scoring model formula is 100% confidential, therefore any information on what exactly will change your scorecard is unknown. But these are some things that I recommend my clients to change in order to trigger higher credit scores,

  1. Having 3-5 credit cards. If you don’t, then open new ones.
  2. Having at least one open installment loan.
  3. Having at least one credit card with a zero balance.
  4. Getting added as a AU to a credit card that is older than your own oldest credit card

Scorecards Regarding Credit Repair

Another thing you may want to consider about scorecards is in regard to repairing your credit. You will want to focus most on the marks that are having the biggest affect on your credit score. But again, even if the Fico scoring model is confidential, it is still based on common sense, so use your brain when reviewing your report to try to pin point the marks that may be a game changer on your overall credit score. For example, if you have three 30 day lates and one 90 day late, then the 90 day late may be the game changer. So wasting your time to only dispute one or two 30 day lates, will not increase much of your credit score. The same is true when it comes to charge offs. If you have 3 charge offs at the same exact time, if you’ll dispute only one, it will not make a big change to your credit score. What you will always look to dispute, is something that will change the overall picture on your credit report and will ultimately bring you in to a better scorecard.

Good luck!